Introduction: Lord Faulks

Edward Peter Lawless Faulks, Esquire, QC, having been created Baron Faulks, of Donnington in the Royal County of Berkshire, was introduced and took the oath, supported by Lord Thomas of Swynnerton and Lord Hodgson of Astley Abbotts, and signed an undertaking to abide by the Code of Conduct.

Afghanistan
	 — 
	Question

The Earl of Sandwich: To ask Her Majesty's Government what plans they have to use the aid budget for Ministry of Defence purposes in Afghanistan.

Baroness Verma: My Lords, all UK aid spending is official development assistance as defined by the Organisation for Economic Co-operation and Development. This means that its main objective is to promote welfare and economic development. The Department for International Development and the Ministry of Defence work closely together to promote peace and stability in Afghanistan, including through the Helmand provincial reconstruction team.

The Earl of Sandwich: My Lords, I understand that there is a need for security and stability in provinces such as Helmand and Kandahar, but is not the department responsible to the taxpayer for what it does, and has not the pendulum swung a little too far towards the Ministry of Defence in those provinces? In a country with such high infant and maternal mortality, surely the department's priorities must be poverty reduction and the millennium development goals. That is why the aid budget was ring-fenced in the first place by all political parties. Why is it now being militarised?

Baroness Verma: My Lords, it is not. Afghanistan is the second-lowest country on the Human Development Index, and, as noble Lords know, everything that DfID does focuses on the elimination of poverty. That remains our core objective. Progress is being made, but this is a trilateral effort between the MoD, the FCO and DfID. I know that the noble Earl, Lord Sandwich, has much expertise in this region, and I share with him the desire to see the elimination of poverty. However, we also need the country's capacity to be built in order to do that.

Lord Chidgey: Can my noble friend the Minister please elaborate on where the proposed 40 per cent increase in DfID aid to Afghanistan is to be utilised? Does she agree that without a strategic plan across all the government departments involved, the extra funding could well be wasted, not assisting our troops or the people of Afghanistan? How will development progress be monitored? How will outcomes be measured? Most of all, who will be mutually accountable for the results?

Baroness Verma: My Lords, using the UK aid budget to secure progress in Afghanistan is the number one priority for the Secretary of State. The additional £200 million will be focused on creating jobs, providing vocational training, improving policing and strengthening the capacity of the Afghan Government. As with all funds to Afghanistan, these extra funds will go through the World Bank, where we reimburse after we have received receipts.

Lord Brett: My Lords, the noble Baroness referred to £200 million. Which of the items listed for additional funding by the Secretary of State were budgeted for previously by other departments, and to which departmental budgets was that money previously allocated? The fear is that rather than putting the money solely into aid and development, the budgets are being transferred.

Baroness Verma: My Lords, I refer back to my original Answer. The aid money used will go through the stringent, rigorous regulations of the OECD, and it is there to be used for the development of Afghanistan and the elimination of poverty.

Baroness Seccombe: My Lords, following our debate last week, can my noble friend tell us what the Government are doing to ensure that women and girls are benefiting from the education aid to Afghanistan?

Baroness Verma: My noble friend raises some very important issues. As I am also a lead spokesman for women and equalities in this House, I should like to say that 20 per cent of DfID support for vocational training is set aside for women. We also support a gender adviser in the Afghan independent electoral commission to strengthen the participation of women in elections as candidates and as voters. Some 28 per cent of teachers in Afghanistan to date are women; 26 per cent of all Afghan civil servants are women.

Lord Hughes of Woodside: My Lords, the noble Baroness is not being precisely clear. Although the overseas aid budget is ring-fenced, will the money going to Afghanistan be over and above that, or is there to be redistribution within the ring-fencing? Given the very hard choices the coalition has made so far in cutting grants, how can that be justified?

Baroness Verma: My Lords, I return to my original Answer. The Organisation for Economic Co-operation and Development puts down very strict regulations on how aid is spent. We will ensure that all the aid money spent is for development and the elimination of poverty.

Lord King of Bridgwater: Does my noble friend agree that if we are to get some benefit for the people of Afghanistan from the considerable sums put into trying to help them in various ways, we ought to concentrate on a few key issues which were suggested in this House very recently-the provision of electricity, clean water and safe transport between different cities on the main roads? Is not the tragic news today confirmation that ensuring secure transport, so that people can get their goods to market and travel freely without risk, is one of the most important things that we can do?

Baroness Verma: I agree with everything that my noble friend has said, and of course part of our programme is designed to ensure that Afghanistan has this road-building capacity. We are also determined to ensure that the MDGs are reached. We have therefore increased the extension for Afghanistan to 2020, because it has started from an incredibly low base.

Lord Richard: The noble Baroness has not answered the question put by my noble friend Lord Hughes, and she does not answer it merely by reiterating the first Answer that she gave-which, again, does not answer it. Is the £200 million fresh money? Is it new money or is it a reallocation of existing funds? It is a simple question.

Baroness Verma: My Lords, the £200 million is being allocated to Afghanistan alongside the budget. We are determined to ensure that we are there to eliminate poverty.

Lord Phillips of Sudbury: My Lords, I declare an interest as I have a son-in-law who is about to go to Afghanistan as a manager of aid for DfID. This is an intractable situation; the history of Afghanistan is uniquely difficult. Is it not about time-to get anywhere on hearts and minds, which is at the heart of aid-that one had dialogue with the Taliban?

Baroness Verma: My Lords, first of all, I wish my noble friend's son-in-law well. We are trying our level best to support the Afghan Government to increase their capacity to be able to engage with all people in Afghanistan.

Banks: Business Lending
	 — 
	Question

Lord Roberts of Conwy: To ask Her Majesty's Government what is the trend in net lending by banks to United Kingdom businesses.

Lord Sassoon: My Lords, net lending by banks to businesses in the United Kingdom has been on a downward trend since the end of 2008, with debt repayments exceeding new lending. Access to finance is essential if businesses are to invest, grow and make their important contribution to supporting the economic recovery. On 26 July, the Government published a Green Paper on business finance to help to inform and take forward their agenda on credit and other sources of finance for businesses.

Lord Roberts of Conwy: I am grateful to my noble friend for that reply. He clearly acknowledges that most British businesses, large or small, need the revived availability of bank lending on reasonable terms to grow and flourish, coupled preferably with a more stable and promising macroeconomic outlook and confidence inspired by the Government's determination to reduce the deficit and reinvigorate our export trade, as the Prime Minister is doing in India today.

Noble Lords: Question!

Lord Roberts of Conwy: Does my noble friend agree?

Lord Sassoon: My Lords, indeed, I do agree with my noble friend. What a surprise. The Government recognise that access to finance is absolutely critical for businesses to survive and grow and that small and medium-sized companies face particular challenges. We need a recovery led by sustained expansion in the private sector and, in particular, by growth in business investment, seizing the opportunities presented by a recovering global economy, which is at the heart of the Prime Minister's visit to India this week. The Government agree that we must continue to support British businesses when they are ready to export and will continue to look, in particular, at the services provided by UK Trade & Investment and the Export Credits Guarantee Department, both of which have shown a significant increase in their export support during the past year.

Lord Barnett: My Lords, could the Minister clarify the Government's policy in this regard? Does he accept that the global banking crisis stemmed from banks lending and creating bad and doubtful debts, which were then packaged up and called derivatives, or toxic debt? The Government now want the banks to start lending more. How are they proposing to do that?

Lord Sassoon: My Lords, the first thing that we have to do is to recognise that the reason why both the Government and the banks were overleveraged, let alone investing in inappropriate products, was at heart a failure of regulation. So the first step that we have taken is to completely overhaul the financial regulatory system to make sure that banks do not get the country into the financial stability crisis that we inherited. The second thing that we have to do is to make sure that banks are enabled to rebuild their capital base so that they can have a secure capital base on which to lend to small and medium-sized businesses in particular. We have set out a range of measures on that, including in the Budget and the Green Paper earlier this week.

Lord Lamont of Lerwick: My Lords-

Lord Martin of Springburn: My Lords, will the Government encourage the banks to give more support to credit unions, which help the poorest in our communities throughout the United Kingdom?

Lord Sassoon: My Lords, as part of the absolute focus that the banks must have on growing loans to small and medium-sized enterprises, credit unions have an important part to play.

Lord Lamont of Lerwick: My Lords-

Lord Higgins: My Lords, is my noble friend not concerned that the massive increase in quantitative easing has not been reflected at all in the figures for the money supply, which has actually gone down? It is not surprising that the banks are not lending more if the money supply is declining. What does my noble friend think ought to be done about this?

Lord Sassoon: My Lords, my noble friend has raised this theme on a number of occasions. It is for the Monetary Policy Committee of the Bank of England to decide how it operates the asset purchase facility-so-called quantitative easing. What we are talking about this morning is how we increase the supply of net lending by banks to United Kingdom businesses. As I said, the Government announced in the Budget a range of measures and have set out an important discussion document, to which I hope noble Lords who wish to will contribute their views by 20 September.

Lord Davies of Oldham: My Lords, the Minister has referred to the Green Paper on two occasions. Is he aware that an official identified it as very green because it reflected the inability of the Business Secretary to convince the Chancellor to adopt a more constructive approach to this issue? Does this not reflect usual tensions within the coalition? Does the noble Lord also recognise that the Budget has been received in such a way as to reduce the level of demand in this country rather than increase it?

Lord Sassoon: My Lords, it is not very productive to reduce everything to trying to find chinks of light between different parts of the coalition. It would be more helpful to have a substantive discussion about the Green Paper. It was published under the joint signatures of the Secretary of State for Business, Innovation and Skills and the Chancellor of the Exchequer and sets out a wide-ranging agenda of possible measures to increase lending to business. As I said, I encourage anybody with views on it to contribute to the debate over the summer.

Lord Skidelsky: My Lords, the noble Lords, Lord Roberts of Conwy and Lord Higgins, raised an important question about the effectiveness of monetary policy which requires an answer from the government Front Bench. Given that the growth of M4, which is the best measure of bank lending, has fallen from 16 per cent to 3 per cent over the past two years, what confidence can the Government have that further quantitative easing will be able to offset the deflationary impact of the planned cuts in public spending? This is not a matter for the MPC; it is a matter for the Government.

Lord Sassoon: My Lords, I will be brief. I would say that the best indicator of the state of bank lending is to be found in the Bank of England's July Trendsin Lending document, which shows that in 2009 bank lending decreased by £45.6 billion and in January to May this year by £11.1 billion. I suggest that the proof of the pudding is in the eating.

Lord Lamont of Lerwick: My Lords-

Energy: Carbon Capture and Storage
	 — 
	Question

Lord Hunt of Kings Heath: To ask Her Majesty's Government what is their response to the advice from the Committee on Climate Change to extend the carbon capture and storage competition to include gas demonstration projects.

Lord Marland: My Lords, we have previously stated that the Government will continue public sector investment in carbon capture and storage technology for four coal-fired power stations. The Committee on Climate Change has recommended that we give serious consideration to funding at least one gas CCS project as part of this programme. We are carefully evaluating whether a demonstration project on gas would prove beneficial and add value to the programme.

Lord Hunt of Kings Heath: I am grateful to the noble Lord for that response. Does he agree that given our indigenous reserves of coal and the fact that coal will be a prime energy product for many decades to come globally, and given the export potential of UK-led technology on CCS, in considering the Committee on Climate Change's report and gas CCS, will he none the less ensure that there will continue to be a strong place for clean coal in this country?

Lord Marland: The noble Lord is quite right. Coal is a very important producer of power in this country. That is why our priority on CCS must be coal, because it is a very dirty material-more dirty than gas. I can assure the noble Lord that that will be our primary focus, despite the thoughts of the Committee on Climate Change.

Lord Clark of Windermere: My Lords, does the Minister appreciate that trees are nature's way of capturing carbon? Is he aware that a 4 per cent increase in tree planting in the UK would allow us to capture 10 per cent of our total greenhouse emissions? What plans do the Government have to increase tree planting? I declare an interest as former chair of the Forestry Commission.

Lord Marland: I am sure the noble Lord will understand that tree planting is not part of my brief, but he is absolutely right that trees are important in reducing carbon. We should of course always encourage that sort of thing.

Lord Willis of Knaresborough: My Lords, there were two significant omissions from the Energy Bill which went through both Houses before the end of the previous Session-the piping of collected carbon and the depositing of it in the North Sea aquifers. What discussions has my noble friend had with the gas and oil industry to ensure that depleted reserves in the North Sea can be got through carbon capture and storage? Have there been any discussions to make sure that those aquifers are available for storing the carbon once it has been collected?

Lord Marland: My noble friend asks a very important question, but I should point out that the North Sea Basin Task Force has been established to develop a project jointly between ourselves and Norway to look at what can be stored in the North Sea basin and under the sea bed.

Lord Skelmersdale: My Lords, will the Government encourage the new coal stations that are being built to operate a dual-fuel policy-coal and biofuels-such as that being carried out at the Drax power station?

Lord Marland: Obviously, the reduction in fossil fuels must be encouraged in every possible way.

Lord O'Neill of Clackmannan: Is the Minister aware that Doosan Babcock, the British-based company that is most involved in CCS work, estimates that it will be 2022 at the earliest before commercially available products will be on the market? What is the Government's thinking on this, because at the moment there is a very long lead time before we are likely to see any carbon capture equipment put onto any coal-fired power station?

Lord Marland: The noble Lord is absolutely right and that is why it is important that we accelerate the process and why we are making our first awards at the end of this year.

Lord Hamilton of Epsom: Does the Minister have any idea of the costs of liquefying CO2 and pumping it into former oil fields in the North Sea?

Lord Marland: I do not have the costs of that to hand, but it is of course something which needs to be evaluated. In all energy production, particularly with renewables, we have to look at the costs very carefully. It is a fundamental part of our decision making and we shall consider it.

Lord Woolmer of Leeds: My Lords, does the Minister agree that, while gas will eventually need to engage with carbon capture and storage, the priority for the next few years is to relate it to the coal industry, because coal-fired power generation plants will be coming to the end of their life in the next few years? Does he further agree that the important matter now is to press ahead with the four working industrial-based schemes so that we can see whether it works, because in the end coal will be generating power throughout the world and the UK could secure export opportunities as well as environmental benefits?

Lord Marland: I agree entirely with the noble Lord, Lord Woolmer. It is fundamental that we develop these technologies and push ahead with them. We are working closely with the Chinese in the China-UK CCS project for near-zero emissions from coal. There is no doubt that, in considering the view of the Committee on Climate Change that one test case should be made for gas, we must not ignore the priority of making coal cleaner.

Lord Dykes: My Lords, in his Statement yesterday, the Minister referred rightly to the race in Europe for low-carbon initiatives. Does that include CCS? Will he have further discussions with the Commission and the Council of Energy Ministers to pursue that on a European-wide basis as well?

Lord Marland: It is up to our Government to show true leadership in this area. We are the second country in the world when it comes to CCS development. We must put as much pressure as we can on the European Union to follow our example and to develop this technology as quickly as possible.

Korean Peninsula
	 — 
	Question

Lord Alton of Liverpool: To ask Her Majesty's Government whether they are seeking to engage China in addressing the deteriorating situation on the Korean peninsula.

Lord Alton of Liverpool: My Lords, I beg leave to ask the Question standing in my name on the Order Paper. In doing so, I remind the House of my non-pecuniary interest as chairman of the All-Party Parliamentary Group on North Korea.

Lord Howell of Guildford: My Lords, we speak with China regularly concerning security on the Korean peninsula. The Foreign Secretary last raised this with Foreign Minister Yang Jiechi and State Councillor Dai Bingguo during his visit to China on 14 July. The UN Presidential Statement on the sinking of the vessel "Cheonan" was agreed with China and it conveys a clear message to North Korea that it cannot act with impunity.

Lord Alton of Liverpool: I thank the Minister for that reply. Does he agree that in the aftermath of the deplorable sinking of the "Cheonan", with the shocking loss of 46 lives, the sort of display of military might that we are seeing this week by South Korea and the United States in their manoeuvres was inevitable, along with the imposition of sanctions? Does he also agree that the Cold War demonstrated that intelligent engagement was equally important, and so it is crucial to keep China engaged in drawing North Korea back into the six-party talks and working for the objective of the denuclearisation of the Korean peninsula?

Lord Howell of Guildford: Yes, my Lords, I agree with both those propositions. We want to get the six-party talks going again to bring China back in. China has a different agenda in some ways from the rest of us for the Korean peninsula, but it, too, shares the broad view that the long-term aim must be the denuclearisation of the whole peninsula.

Lord Grenfell: My Lords, does the Minister agree that there is a temptation in some quarters to dismiss North Korea's pronouncements as sabre rattling, when history has taught us that the step from sabre rattling to sabre thrusting can sometimes be very short and unexpected? Does the Minister also agree that it is the habit of unstable dictators who feel that they are not being taken seriously to act irresponsibly and unpredictably? Does he agree that talk of sabre rattling is totally out of place in this situation?

Lord Howell of Guildford: The noble Lord speaks wise words. The North Koreans are capable of really dangerous acts. They have the Taepodong missile, which in theory has an intercontinental range. They have tried one-it did not work, but it might have done-and they are prepared, under pressure, to do very dangerous things. This is a very dangerous situation and we should have no illusions that it is just a question of sabre rattling. It is right that the entire community should recognise this and that the Chinese should realise that, although North Korea is their neighbour, they should be as worried as the rest of us to have a neighbour with these inclinations.

Baroness Cox: My Lords, is the Minister aware of widespread concern over the deteriorating situation in North Korea with regard to human rights, with the recent public executions by firing squad of former Cabinet Minister Kwon Ho Ung, reportedly for failing in his negotiations with South Korea, and also of two young men in their 20s, as well as concern about the US citizen, Mr Gomes, who has recently tried to take his life in prison? Will Her Majesty's Government use the good offices of our ambassador in Pyongyang to raise these serious issues with the North Korean Government?

Lord Howell of Guildford: These are both very worrying situations. The report of the executions is unconfirmed but we have sought to establish what happened. If it is confirmed, the noble Baroness will be absolutely right that it is an extremely grim example. On the question of Mr Aijalon Mahli Gomes and his early release from prison, he is currently on hunger strike. We are aware of his case and are monitoring it closely. However, the Swedish embassy in Pyongyang is the consular protecting power for US nationals in North Korea and is handling the case, although we are keeping a close watch.

Lord Anderson of Swansea: My Lords, what is the extent of the concern of Her Majesty's Government about the treatment of North Korean refugees who fled over the border into China? Does this figure on the agenda of the human rights dialogue between China and ourselves and the European Union?

Lord Howell of Guildford: Yes, it most certainly does. I was recently in Jilin province, where a lot of refugees were coming over the border, and there is no doubt that some were put in labour camps and treated extremely badly. After allowing a lot of refugees in, the Chinese have now cracked down on them, presumably because they create some embarrassment for the Chinese Government. However, it is certainly a matter that we have raised and are worried about because there are signs of these unfortunate refugees receiving some unpleasant treatment.

Lord Maginnis of Drumglass: My Lords, on this, the 60thanniversary of the outbreak of the Korean War, in which 3 million people died, including 1,000 British servicemen, do the Government agree that the serial abuse of human rights in North Korea demonstrates that the sacrifices of 60 years ago did not end the suffering of the Korean people? What are we doing to ensure that the North Korean leadership is brought to justice before the International Criminal Court and that the leaders are not allowed to get away with salting away their ill-gotten gains in foreign bank accounts?

Lord Howell of Guildford: I agree totally with the sentiments behind what the noble Lord says. As to bringing these matters before the International Criminal Court, the ICC can go against an individual in a country that is not a party to the ICC only if the action is triggered by the UN Security Council, and there we have a problem. China is a member of the UN Security Council and therefore the chances of progress there are very small. However, these matters are constantly in our minds and certainly, if the ICC chooses to make further investigations and can identify an individual rather than just generalise against a whole country, we will be very glad to see that.

Baroness Falkner of Margravine: My Lords, coming back to the Question of the noble Lord, Lord Alton, does my noble friend agree that the role of China in several international disputes-not least with Iran, as well as with North Korea-is becoming similar to that with Russia during the Cold War? Do we not therefore, across the other partners in the Security Council, need to take a more robust stand, otherwise we will end up with an impasse, as was the case with Russia, for 30 or 40 years?

Lord Howell of Guildford: My noble friend is right. Of course we must be robust but I emphasised earlier that China has its own view of reform of the DPRK. It is not content with the present situation-understandably so-and has supported the sanctions movements against North Korea, which are strong in the European Union and have also recently been beefed up at the suggestion of Secretary Hillary Clinton in America. Therefore, the Chinese are supporting these sanctions and that is an advance, but I think that we have to move in the right direction through a combination of skill, diplomacy and persuasion to bring North Korea to a realisation that it must act responsibly or it will be on the path to its own self-destruction.

Health and Social Care Act 2008 (Consequential Amendments No. 3) Order 2010
	 — 
	Motion to Approve

Moved By Earl Howe
	To move that the draft order laid before the House on 21 June be approved.
	Relevant Documents: First Report from the Joint Committee on Statutory Instruments, considered in Grand Committee on 26 July.
	Motion agreed.

Electricity and Gas (Carbon Emissions Reduction) (Amendment) Order 2010
	 — 
	Motion to Approve

Moved By Lord Marland
	That the draft order laid before the House on 14 July be approved.
	Relevant Document: 2nd Report from the Joint Committee on Statutory Instruments, considered in Grand Committee on 26 July.

Lord Marland: My Lords, I beg to move the Motion standing in my name on the Order Paper.

Lord Hunt of Kings Heath: My Lords, before the House moves to approve the Motion, perhaps I can raise a point with the Minister. This matter was discussed very fully in Grand Committee two days ago, but I draw the attention of the House to the Merits Committee's report on the order which drew attention to the fact that the draft statutory instrument had been laid with a detailed impact assessment running to 77 pages. The committee reported that, given the speed with which the Government wished this SI to proceed, it has not had the opportunity to make any detailed assessment of it.
	I thank the Merits Committee for its work and for its report. Of course, I accept that there are circumstances in which Governments need to process statutory instruments as quickly as possible, but it is important that the Merits Committee is given sufficient time to do its job effectively. I ask the noble Lord whether he can give an assurance that in future statutory instruments laid by his department will be laid in time for the committee to have the time that it needs to report fully to the House.

Lord Marland: My Lords, the Merits Committee chose not to draw the instrument to the special attention of the House but, as the noble Lord said, it included an overview paragraph. This statutory instrument was laid after 30 days of public consultation and the committee complained in its report that it had not had sufficient time, but we believe that this order is fundamental to keeping the pressure up on developing a low-carbon economy, and so we took those measures.
	Motion agreed.

Equality Act 2010 (Consequential Amendments, Saving and Supplementary Provisions) Order 2010
	 — 
	Motion to Approve

Moved By Baroness Verma
	That the draft order laid before the House on 14 July be approved.
	Relevant Document: 2nd Report from the Joint Committee on Statutory Instruments, considered in Grand Committee on 26 July.
	Motion agreed.

Serious Organised Crime and Police Act 2005 (Disclosure of Information by SOCA) Order 2010
	 — 
	Motion to Approve

Moved By Baroness Neville-Jones
	That the draft order laid before the House on 18 January be approved.
	Relevant Document: 6th Report, Session 2009-10, from the Joint Committee on Statutory Instruments, considered in Grand Committee on 26 July.
	Motion agreed.

Local Government Bill [HL]

Main Bill Page
	Copy of the Bill
	Explanatory Notes
	Amendments

Report

Clause 1 : Prevention of implementation of certain proposals for single tier of local government
	Amendment 1
	 Moved by Lord McKenzie of Luton
	1: Clause 1, page 1, line 3, at beginning insert "Subject to the proviso in subsection (1A)"

Lord McKenzie of Luton: My Lords, I shall speak also to Amendment 2. These two amendments provide that a relevant order may be made after the commencement of the Act and that the Secretary of State must, within three years, publish criteria that will apply for a replacement order to be made. Noble Lords will recognise that this is a narrowly drawn amendment in that a relevant order is one in respect of which proposals have been received by the Secretary of State before the commencement of the Act.
	It might be helpful if I explain that our intent to have a broader requirement imposed on the Secretary of State to report within a period of time on whether any further proposals for unitary status will be considered, and on what basis, is sadly outside the scope of the Bill. However, we consider that the Secretary of State should have a positive duty to report, after a period, on whether he will entertain any further unitary proposals and on what basis. This is not about going over old ground and seeking to reopen the quashing of the Exeter and Norwich orders, and it is not about challenging the constitutional propriety of what has ensued. We accept that we are where we are on these matters. However, it is about keeping alive the prospect of revisiting opportunities for a single tier of government generally and specifically for Norwich, Exeter and Suffolk. It is also not about requiring the Secretary of State to invite any proposals, but about causing him at some point in the future to publish the basis on which, if at all, he might invite proposals.
	As we have discussed at earlier stages of our deliberations on this Bill, the 2007 Act continues to give the Secretary of State the power to invite proposals for a single tier of government. This amendment neither seeks to expand nor curtail that power. We have heard from the Minister before that it is unlikely that the Secretary of State will wish to invite further proposals during the course of this Parliament. It is that absolute, dogmatic position which this amendment seeks to qualify. It would require him to justify continuing with that stance throughout the Parliament.
	We know that these are going to be exceptionally tough times for local authorities, made worse by the macroeconomic policy of the Government, who are intent on cutting public expenditure deeper and faster than is necessary to address the challenges of the public finances. Some principal authorities will face those challenges as unitary authorities, and some under a two-tier system. The need to find new ways of working, embracing area-based budgeting-Total Place, if you will-and developing broader partnerships, will be essential. The Government's position seems to accept that the current configuration of local authorities is the best way to move forward on these issues. In the case of Exeter and Norwich, the Minister asserts in her letter of 22 July that savings that could be achieved under unitary status can be achieved, and indeed exceeded, by collaborative working between the two tiers of local government, although no detailed analysis or independent review underpins that assertion. Even if it is right-we do not necessarily accept that it is-what work has been undertaken to say that the same runs true for what we might describe as the extra challenges engendered by the cuts coming down the track from the public expenditure review? If there is a requirement for new thinking, new ways of working and different models of commissioning, is it not reasonable that along the way there is the opportunity for an update on the current divide between unitary and two-tier status?
	In essence, that is what this amendment seeks, specifically in the cases of Norwich, Exeter and Suffolk because those are the constraints of the Bill, but the same runs generally. At a point in the future not more than three years away, the Secretary of State should report on whether he plans to consider further proposals for single-tier local government. He will be able to do that with the knowledge of what has happened in the interim, how local authorities are coping with the new environment, and whether the structure of local government-unitary or two-tier-is a significant factor in driving better outcomes. He should hear the voice of local authorities and communities in undertaking that analysis.
	The amendment should not be difficult for the Government to accept. It is about looking to the future, and about a medium-term opportunity for local councils to get an update on whether structural change-if it is in the interests of their communities-is available or off the agenda for the remainder of the Parliament. Given the huge uncertainties of the economic landscape, made much worse by this coalition Government, that is not an unreasonable proposition.
	If the Minister cannot support the amendment, what alternative arrangements does her department have or will it put in place to keep under review the availability and potential use of the powers in Chapter 1 of the 2007 Act? What plans are there for reporting to Parliament on these matters? If we may not have provisions in the Bill, I hope that she can at least give us some assurance on the subject.

Lord Howarth of Newport: My Lords, I wish to speak in support of Amendments 1 and 2. These amendments invite the Government to reintroduce principle into their consideration of local government restructuring. The Secretary of State would be obliged by 2013 to consider whether further unitary reorganisations might in principle be permitted, and to state his criteria for deciding for or against such reorganisations. I will, if I may, explain some of the principles to which I believe the Government at that time should have regard. I will illustrate them by reference to Norwich and Exeter, as it is those cities with which the Bill is concerned. The principles illustrated in relation to Norwich and Exeter should be taken, however, as models for general application as and when the Government abandon their present unreasoning hostility towards creating new unitary local authorities.
	There is, of course, a very strong case in principle for unitary local authorities. Unitary local government can be expected to lead to better provision of services in terms of quality, efficiency and economy, arising from closer local knowledge and responsiveness and better adapted service models. In the case of Norwich, a local authority dedicated to serving Norwich, its members all local people, would have intimate knowledge of the issues and needs in Norwich which, in a complex and sizeable urban community, are very different from those of rural Norfolk. Cities such as Norwich and Exeter need their own distinct policies and distinct administration if their distinctive problems and opportunities are to be addressed to best effect, and to enable such cities to realise their full potential, economically, culturally and socially. Unitary local government that enabled Norwich and Exeter to maximise their economic and cultural success would of course be to the great benefit of Norfolk and Devon.
	It is plain common sense that unitary government will be more economical, having no duplication of staff, no fragmentation of functions, no complex procedures for co-ordination and no opacity in accountability. Unitary local government is also good for democratic culture. It provides for clear and accountable local political leadership. Norwich councillors and Exeter councillors would be straightforwardly answerable to Norwich people and Exeter people.
	In a two-tier system, there are two councils, two sets of councillors, two sets of policies and two sets of service delivery arrangements. County and district are conflicted and confused between the competing demands of rural and urban needs. Some responsibilities are split; for example, housing and social services. Some overlap; for example, planning, with businesses having to negotiate two overlapping bureaucracies. In a two-tier structure, there can be no clear focus in policy-making, no clear strategic direction, no clear political leadership and no clear political responsibility.
	The Conservative Party used to understand that local government was the seedbed of our democratic culture-a culture that has become all too withered. One cannot overstate the importance of reviving our democracy from its local base. It is a consideration of principle that should recommend itself to the Conservative Party, if it still has a sense of history, that the structure of local government should enable communities to be proud communities. Many of the cities that have become unitary authorities within the past 20 years were historically proudly self-governing county boroughs independent of their surrounding counties-some of them, like Norwich and Exeter, with charters going back many hundreds of years. For them, the 1974 reorganisation was an historical aberration.
	No one recently has better described the importance of place than the noble Baroness, Lady Eaton, whom I am very pleased to see in her place. She comes from Bradford, like Mr Pickles. She has been chair of the Local Government Association. In a SOLACE Foundation pamphlet in January 2009, she wrote about,
	"the more difficult agenda-the holistic agenda of growing a place's unique character. This is where the true genius of local government really lies. Not just being the deliverer of a Whitehall agenda but by being the champion of a locality ... Pride in place is not just about good services and sound finances, critical thought these are, but it is also about being the guardian of an area's character, knowing and reflecting its personality and preserving its identity. It is to protect and enhance its story and this is best achieved by those who, day by day, walk local streets, suffering with the electorate their traumas and sharing in their achievements".
	The noble Baroness expressed it extremely well.
	I ask noble Lords on the Benches opposite to understand just how demeaning it is when, without any consultation whatever, the county, none of whose cabinet members represent Norwich wards, decrees that the street lights in Norwich should be switched off at night, when it seeks to impose closure of cherished daycare centres, when it imposes a restructuring of children's services, or when it refuses to permit the locally desired pedestrianisation of an historic street. A two-tier structure invites that kind of arrogant and improper behaviour by the county.
	The Conservative Party in truth has no objection in principle to unitary local government. Indeed, the previous Conservative Government created unitary local authorities wholesale. That Government were in deep difficulty, as was the whole of local government, as a result of the crass misjudgments of the 1974 reorganisation, the anomalies left by the abolition in 1986 of the metropolitan counties, the chaos created by the poll tax and the progressive erosion in the 1980s of local government powers. The noble Lord, Lord Heseltine, as Secretary of State for the Environment, trying to recoup something from this crisis of local government, decided to review not just the financing of local government, but its structure and management. A consultation paper in 1991 proposed,
	"a move towards unitary authorities where these do not already exist".
	The Conservative Government set up a new quango-the Local Government Commission for England-to undertake a review and make recommendations. The criteria given to it for evaluation were not just those of financial costs and benefits, but to strengthen identity, accessibility, responsiveness and democracy.
	In September 1993, the noble Lord, Lord Deben, then the right honourable John Gummer, Environment Secretary, strengthened the presumption in favour of unitary local authorities replacing two-tier structures. He said:
	"Authorities must be big enough to do the job and small enough to know the people".
	On 1 October 1993, the Financial Times reported Mr Gummer as announcing that:
	"England's two-tier local government structure should be replaced with a series of unitary authorities, even if it costs more than the present system".
	On 20 October, he said in another place,
	"we would expect the norm of local government to be unitary authorities ... we point to the importance of unitary local government because it ensures that people know whom to hold to account when decisions are made. In two-tier local government, there is often a grave difficulty with that".-[Official Report, Commons, 20/10/93; col. 261.]
	Admittedly, the Banham review as it developed was pretty chaotic, and Howard Davis of INLOGOV afterwards described the review as,
	"an object lesson in how not to do things".
	None the less, the outcome of the process driven through by the Conservative Government was the creation in England of no fewer than 46 new unitary local authorities, 19 of which finally came into being shortly after the 1997 election.
	The litany of unitary authorities newly created or recreated in England in that period includes Hartlepool, Hull, Middlesbrough, Stockton on Tees, Bournemouth, Brighton and Hove-of which my noble friend Lord Bassam was a distinguished leader-Darlington, Derby, Leicester, Luton-of which my noble friend Lord McKenzie was another distinguished leader-Milton Keynes, Poole, Portsmouth, Southampton, Stoke on Trent, Swindon, Reading, Slough, Wokingham, Peterborough, Halton, Warrington, Plymouth, Torbay, Southend, Thurrock, Blackpool, Nottingham and Telford and Wrekin. How can it reasonably be contended that the two cities of Norwich and Exeter should not be included in such company and, indeed, in the company of the further unitaries subsequently created by the Labour Government?
	In Scotland and Wales, the Conservative Government went further and simply replaced the inherited structures of two-tiered local government with a consistent pattern of unitary local authorities everywhere. There are 32 in Scotland and 22 in Wales. The previous Conservative Government created in all, for very good reasons, 100 new unitary local authorities. That is even better than Don Bradman's test batting average of 99.6.
	It is striking that no local authority has ever applied to be allowed to revert to being part of a two-tier structure. The noble Baroness, Lady Hanham, never, so far as I know, but may be she will tell the House that I am incorrect on this, when she was a distinguished leader of the Royal Borough of Kensington and Chelsea-I know she was because I was one of the contented people who enjoyed living in the borough under her leadership-proposed that matters should be restored so that the proudly Royal Borough of Kensington and Chelsea could be placed once again under the GLC and ILEA to jog her elbow and take the big decisions for her community. Never did she express nostalgia for that. As one of Newport's MPs from 1997, I witnessed how Newport County Borough Council, later Newport City Council, responded most positively and effectively under the leadership of Councillor Sir Harry Jones to the opportunity created by unitary status. The noble Baroness and I both know from our different responsibilities as elected representatives how unitary status challenges and allows communities to thrive on the basis of local self-government.
	The new coalition makes grand professions about localism. The Secretary of State said in his statement on the Queen's Speech on 10 June:
	"if you want to restore faith in politics, you make sure that local government is properly accountable to the voters ... If you want people to feel connected to their communities, proud of their communities, then you give people a real say over what happens in their communities. And the power to make a difference ... Everything we've done"-
	said Mr Pickles-
	"has been about giving up control".
	Tell that to the people of Norwich and Exeter. The Minister for Decentralisation, Mr Greg Clark, in his speech to the Local Government Association conference on 8 July, said:
	"we will put people back in charge of their lives. Put businesses and councils back in charge of economic growth. Put town halls back in charge of local affairs".
	Unfortunately, the professions of coalition Ministers have not been matched by their actions and their policies. All the signs are that the new localism will be about bypassing elective local government and recklessly creating excessive dependence on unaccountable community groups. Most flagrantly so far, the one tangible policy for local government that the coalition has introduced is this Bill, which denies Norwich and Exeter the local self-government that the coalition's professed principles should have caused it to endorse. It is a policy that is nakedly driven by calculations of party political interests: no more and no less.
	At no point in any of our debates have the opponents of unitary status for Norwich and Exeter, whether on the Front Benches or the Back Benches, provided any argument of principle in support of their position. Their arguments have all been splutter, irrationality and irrelevance. We have heard from them unfounded and offensive assertions that Norwich is not competent in its financial management, bogus points about costs and the tangential accusation that the Secretary of State in the previous Government had not proceeded in accordance with criteria that he had published three years before in very different circumstances. They have produced no arguments against the merits of the case for unitary reorganisation, which is the proper heart of the matter.
	The coalition's policy in this Bill may or may not be hybrid. The case for hybridity was in the event not fully tested by the Examiners, because Norwich and Exeter withdrew their memorial, not having the resources to pay for an appeal against the judicial review. What it certainly is, is discriminatory.
	Eric Pickles seems to have forgotten that he is no longer chairman of the Conservative Party. I have known him for many years, and I hold him in affection. I know him to be a tough, opportunistic party politician, and no one will drum him out of the Carlton Club for that, but bullying is another matter. In this policy and this Bill, he is bullying the people of Norwich and Exeter and their elected representatives, particularly the local Liberal Democrats. He is also bullying his officials. He is on record as saying that he intends,
	"to keep a ... pearl-handled revolver in my drawer, and the first civil servant who suggests local government reorganisation will be shot"-
	spoken humorously, of course, but unmistakably threatening and not an appropriate tone. No Minister should set out to scare his officials from offering him their honest advice. Eric Pickles is Secretary of State now-"Bottom, how art thou translated"-and he should behave like a proper Secretary of State. He has wider responsibilities than just to his own party. His bluster, of course, is the product of some embarrassment that he is repudiating the principled position in support of unitary local government that his party espoused a few years ago and which he cannot find rational arguments to disavow.
	I should like to ask the Minister why, in preparing the Bill and giving instructions to Treasury counsel, the Government did not repeal Part 1 of the Local Government and Public Involvement in Health Act 2007. Is it that the Secretary of State and CLG officials are not after all opposed to unitary local authorities in all circumstances? Have they deliberately kept the door ajar for new unitary counties in the future? If they want to see new elected mayors in major cities, as they say they do, that surely implies unitary cities. Their objection to unitary status for Norwich and Exeter is based not on principle but on blatant political opportunism, including on the part of Mr Cameron in Norfolk during the election campaign. There remains an ancien régime attitude among the Norfolk Tories, courteous and elegant as they are, that the little people-the plebs of Norwich-should be bent to their will and made to suit their convenience. Mr Cameron's Conservative Party still, in the 21st century, considers that humbler folk should tug their forelocks. It is a selfish state of mind: "what we have we hold". It is a primitive state of mind: territorial primitivism. Their objection to local self-government for Norwich has nothing to do with principle.
	In not repealing the 2007 legislation, the Government make it clear that they do envisage further unitary reorganisations. These amendments would oblige them to revisit the issue of unitary reorganisation by 2013-a reasonable timescale-and to articulate the principles on which they base their policy in regard to the structure and functions of local government, as well as their criteria for individual decisions on applications for unitary status. The amendments would provide a further opportunity for local authorities which have been victims of this Government's discrimination-Norwich, Exeter and Ipswich and the Suffolk authorities-once again to make their case to be allowed the same opportunities as so many other comparable authorities. By then, Mr Pickles and his pearl-handled revolver will be no more than a distant folk memory in CLG or what remains of it. Indeed, it is probable that the coalition will equally have melted into thin air. If there is anything left by then of local government itself, we must hope for a fairer and more principled approach by Whitehall to local government restructuring. These amendments point in that direction.

Baroness Butler-Sloss: I scarcely know where to begin. I listened with absolute fascination to the delightfully inaccurate, inappropriate and, in places, offensive comments made by the noble Lord, Lord Howarth of Newport. I am not a politician. I am a pleb of Devon. I am proud to be so and I am proud not to be a politician. But, on 22 March this year, I moved a regret Motion in which I set out in some detail a large number of reasons why Exeter should not be a unitary authority. Equally, the points were made why Norwich should not be a unitary authority. That regret Motion, asking the Government to look again, was overwhelmingly supported by this House. One of the reasons was that the Permanent Secretary to the then Secretary of State in the previous Government advised against the two orders as the accounting officer as well as his concerns.

Lord Howarth of Newport: May I ask the noble and learned Baroness what what she is saying has to do with the amendments we are debating?

A noble Lord: Oh!

Baroness Butler-Sloss: I hope your Lordships will appreciate that I would not have dreamt of standing up on this amendment if we had not had this tour de force of recrimination about the failure to get these two orders through because the judge found against them. I thought that we were talking about the amendments. I also thought that I was entitled, as a Member of this House, to answer what has been said. But I will now move to the fact that the purpose and clear intention of these two amendments is to sabotage this Bill because it would be the status quo ante. It would bring the whole thing back. It would prevent a closure of Exeter and Norwich.
	Turning specifically to some of the points made very briefly-perhaps unlike the noble Lord-I was going to point out that Exeter is well looked after by Devon. The culture of Exeter is understood by Devon and I will give two examples. Councillor Vanessa Newcombe is a twin-hat councillor for Exeter and for Devon. Councillor Andrew Leadbetter has been, with the agreement of Devon and of Exeter councils, made in the Cabinet of Devon a councillor specially responsible for Exeter. He lives in Exeter and has done so for 35 years. His loyalties are as much to Exeter as they are to Devon, as indeed are the loyalties of Councillor Vanessa Newcombe. To suggest that Exeter is in some way in a difficult position because it is not understood and is not taken account of, from someone who is concerned with Norwich and does not know what goes on in Exeter and Devon, I find absolutely astonishing. The relationship between Exeter and Devon means that Exeter has gained from payments made by the county relating to matters such as the new shopping centre at Princesshay, the building of five secondary schools and two primary schools in Exeter and, indeed, the proposal to have an eco-neutral school which is about to be built somewhere near St. Thomas. A waste energy plant is also about to be built by Devon County Council and, interestingly, Councillor Vanessa Newcombe, with her two hats, says in an e-mail of which I have a copy here that she views Exeter and Devon as, "not being able to survive without each other".
	The whole of what is being suggested here would put us back to a position that your Lordships felt was not tenable on 22 March and, I respectfully suggest, is not tenable today.

Lord Tope: My Lords, again I have the pleasure of following the noble and learned Baroness, Lady Butler-Sloss, as I seem to be doing permanently on this Bill, and again, as previously, we are in full agreement. I could not have put any better what she has just said. In moving the amendment, the noble Lord, Lord McKenzie of Luton, said he accepts that we are where we are and that the amendment is about the future and not the past. But he was followed immediately by his noble friend Lord Howarth, who spent a considerable time telling us that it is all about the past and that he far from accepts that we are where we are. I think that the noble Lord on the Front Bench must be wishing that he could hide from his noble friend sitting two Benches behind him.
	I understand very well why noble Lords on the Benches opposite, particularly the noble Lord, Lord Howarth, and others, believe that the previous proposals were right. I understand therefore why they believe that the Government are wrong to carry out the manifesto commitments of both parties in the coalition to get rid of them as soon as possible, but what I do not understand is why he cannot accept that we are where we are. That is simply not going to happen.
	I listened with great interest and some sympathy to all that the noble Lord said about the benefits of unitary government. As I declare almost every time I speak on this issue, I have been a member of a unitary council-as I still am-for many years, and there are benefits to it. But, as I also seem to have to keep saying, the future that lies before all local government and before the country over the next few years means that this really is not the time for us to be distracted into what is almost always, and certainly has been in the case of Norfolk and Devon, enormously time-consuming, expensive and perhaps above all emotionally draining exercises in this sort of boundary restructuring. What we need to concentrate on now is how councils, whether in two-tier or unitary areas, can work together by sharing services and, in some cases where appropriate, by sharing offices. They should not be arguing about expensive boundary changes and unitary restructuring. That is simply off the agenda.
	Should there ever be a time when this comes back on to the agenda, whether that is in the lifetime of this coalition Government, which I must say seems unlikely, or-

Lord Grocott: My Lords-

Lord Tope: Perhaps I may finish the sentence and then I will give way to the noble Lord. I have nearly forgotten the sentence. If this comes back on to the agenda in the lifetime of this coalition Government or in the lifetime of any future Government, it does not need an amendment to this Bill to enable it to do so.

Lord Grocott: I am grateful to the noble Lord. In view of his opposition to what he has described as expensive boundary changes, I wonder whether he will join us on this side of the House in opposing the expensive parliamentary boundary changes that have been proposed in the Government's most recent legislation.

Lord Tope: Unless something much more revolutionary than I expect is taking place, a change of parliamentary boundaries, which happens fairly regularly, does not entail the wholesale restructuring of the local authorities in an area, and that is where the expense arises. So the answer is no.
	I have said it before and I want to say it again because we keep going over the same ground. If there is any message coming from this House-personally, I believe strongly that local government actually knows best and should be left to get on without messages from this House or anywhere else-it should be this. If noble Lords opposite have any influence, particularly with the city councils concerned, they should use that influence to urge these councils and councillors to try to put the difficult and emotional past few years behind them and to build new and constructive relationships so that they can work together co-operatively in the way we have talked about.
	There is already evidence that that is happening in both Exeter and Norwich and Devon and Norfolk. We should encourage that; noble Lords opposite should spend their time and energy encouraging that to happen. We on this side of the House should do the same, particularly in relation to the counties. Where we have friends and influence, we too should recognise that the cities believe that they have grievances. Whether or not we accept that they are justified, let us accept that they are truly felt and work together to try to overcome that and to build a positive and constructive relationship between authorities of whatever nature, better to serve their people in what will be an extremely difficult, three, four or five years to come.

Baroness Hollis of Heigham: My Lords, I will be brief. Fairly obviously, I support these amendments. Does anyone in this Chamber doubt that unitary government, especially for cities, is the most effective form of local government and offers the best value for money? I was a Norwich city councillor when we were unitary before 1974 and know what it has meant for the city of Norwich.
	Basically, unitary structures offer at least four gains for the people who local councillors seek to represent. First, they offer better integrated services. This is because services are all on one tier and you can make decisions out of the box, so to speak, and across the lines-particularly, for example, in housing and social services. When I was a very young councillor and chair of Norwich's housing committee, my vice-chair was the chair of what was then called, in those pre-Seebohm days-the noble Baroness, Lady Shephard will recall this-the welfare committee. The result was that we could produce halfway houses for battered wives and supported accommodation for those with severe learning difficulties because we ran housing and social services as one semi-common service. That is no longer possible. Now services are fractured and, frankly, it is a full-time job being poor and vulnerable.
	The second gain from unitary structures for cities is better value for money-I shall in a moment engage with the comments made by the noble Lord, Lord Tope-because it avoids duplication, for example, on economic development, and the toing and froing on planning applications between two tiers. As I have told the House on previous occasions, when I was leader of Norwich City Council, development opportunities that would have brought 600 to 800 jobs to the city of Norwich were lost when the developers walked away after they learnt that they would have to work with two tiers. I do not doubt that the county would have been supportive-I have no reason to think it would have blocked it-but the point is that for those seeking to come to the city the structure of local government was seen as an impediment to what they wanted-which was quick, easy, simple, transparent and responsive comments to their proposals.
	Not only is unitary better for value for money in terms of avoiding duplication, it is also cheaper-and here I shall tackle the points made by both the noble and learned Baroness, Lady Butler-Sloss, and the noble Lord, Lord Tope. For I think the third time, the noble and learned Baroness, Lady Butler-Sloss, has quoted the Permanent Secretary as the auditing officer saying that this did not represent best value for the money; and for the third time I shall attempt to appropriately correct her understanding of what the Permanent Secretary was saying. He was indeed saying that unitary Norwich and unitary Exeter were not best value for money-but compared with what? It was compared with a unitary county of Norfolk and a unitary county of Devon which wiped out the rest of local government-an outcome that no one except the Permanent Secretary and the Boundary Committee supported. Indeed, the county of Norfolk, I understand, would have taken out a JR against the recommendation of the Permanent Secretary. It is simply misleading and fallacious to quote the Permanent Secretary, as the noble and learned Baroness has done on several occasions-

Earl Cathcart: My Lords, two separate Labour Secretaries of State said on three separate occasions that a unitary Norwich would not give value for money. Is the noble Baroness saying that they were wrong?

Baroness Hollis of Heigham: No, my Lords. We were then in a very different economic situation. What is more, when this process was started, with a Liberal Democrat minority administration running the city of Norwich, the financial figures were incomplete. The revised financial figures, which have been accepted by the department and embedded in its impact analysis-it is available to the noble Earl and I am sure that he has studied it-show that the original figures have been overtaken by events. I shall proceed to give the revised figures in a moment.
	Perhaps I may continue my response to the noble and learned Baroness, Lady Butler-Sloss. In the hierarchy of value, the cheapest option is a unitary county of Devon and a unitary county of Norfolk, which nobody wants. The second-cheapest option is unitary Norwich and unitary Exeter. The most expensive option, which neither the Permanent Secretary nor the noble and learned Baroness mentioned, is the status quo, which is exactly what the Minister is proposing in the Bill. Therefore, I hope that if we revert again, for the fourth time perhaps at Third Reading, to the Permanent Secretary as the chief auditing officer, it will be with all three options in mind and not just the two.
	The Minister's own figures in her recent letter of 22 July, which have already been quoted by my noble friend Lord McKenzie, show just how substantial would be the cost savings and value for money resulting from unitary structures. This is where, I suggest, the noble Lord, Lord Tope, is wrong. The Minister's letter-I am sure that he has it to hand, so that he can confirm the statistics that I am about to quote-shows that, from year 2, the savings will exceed costs. To deny local authorities the opportunity to achieve those savings is to add to the costs and council tax of local citizens at just the same time as the Government are requiring cuts of 25 per cent or more. The Minister's letter shows that, by year 2 of the transition period, savings will exceed the cost of transition and that, by year 4 and thereon, the savings will be nearly £4 million a year for the city of Norwich. Norwich has around 40,000 properties and the savings from unitary structure will be £4 million. In other words, there would be savings to every household in Norwich of £100 a year on the Minister's own figures if Norwich were to be unitary. That £100 a year has been denied the people of Norwich and similarly, I presume, the people of Exeter, either through their being better off or the authority being better able to provide appropriate services. I therefore hope that when the noble Lord, Lord Tope, says that we cannot afford the cost of reorganisation, he is respectful of the Minister's own figures, from her own letter of 22 July, which show exactly the opposite.
	The third argument for unitary status, over and beyond better services for our citizens and better value for money, is greater citizenship, accountability and transparency. City hall becomes a one-stop shop. I always knew when someone was about to complain, because they stopped talking about the "city council" of Norwich and started talking about the "city corporation" before letting fly. People in the Norwich area have something like four local authorities providing their services. Of course, they do not know who does what, to what standard, at what value for money or with what outcome. We are then surprised by low voter turnouts for elections to authorities whose very structures and very responsibilities baffle most citizens. After all, under some of our existing two-tier structures, local authorities are increasingly run by the few people who can be bothered to stand, elected by the few people who can be bothered to vote. Voting turnout is, usually, significantly higher in unitary authorities and significantly lower in two-tier structures precisely because there is not the democratic deficit in unitary government that there inevitably is in two-tier structures.
	Finally, unitary structures work because they are simpler and clearer for other bodies, agencies and outside organisations to work with. That is whether they are businesses seeking to expand or relocate, voluntary organisations wanting support for their hunt for capital for premises or revenue for staff, or public agencies such as health authorities, sports bodies, tourism agencies and the like. I repeat the question asked by my noble friend Lord Howarth-after all, Mr Pickles comes from Bradford and the Minister also comes from an area with a good, strong, competent unitary authority, to which I pay all credit. Would the Minister welcome, say, the adult or children's services in her former authority going to Boris or the GLA, and if not, why not? After all, there is far more sense in that proposal for a densely populated London area, where the boundaries between boroughs are perhaps more artificial than in some existing two-tier structures.
	No one doubts that unitary local government is where we will be; it is only how long it takes us to get there. Enlightened Conservatives, led by the noble Lord, Lord Deben, who was then John Selwyn Gummer, and Mr David Curry-I pay credit to them, as they were always collaborative, open and accessible-made strong strides in that direction in the mid-1990s, resulting in the Conservatives sponsoring 100 or so new unitary authorities. That was party blind. Labour councils, Lib Dem councils, as they came to be, and Conservative councils all benefited from two Ministers who were committed to the principles and values of local government, as Labour Secretaries of State were. The unitary authorities introduced in the past few years under Labour have gone, too, to authorities that will be Conservative, Lib Dem and Labour. In other words, the history of the move towards unitary local government has been party-politically blind in accepting the value of unitaries, particularly for cities and in terms of clarity, accountability and better value for money. As a result, it has had all-party support. It is this Government who have chosen that the two cases of Norwich and Exeter, both county boroughs for centuries, are not to regain that status or to be able to offer their citizens those same values of transparency, accountability and value for money.
	This amendment lays open the possibility that, down the line, future bids for unitary status may be considered with an open mind and in a non-party way by the Secretary of State and it asks that those criteria be published. If we choose, we can rebuild that party-blind consensus to support the localism of local government to which the coalition gave such support in their post-election manifesto. However, you cannot do that while supporting a Bill like this and rejecting an amendment like this. That is to refuse to accept unitary structures in the future for cities such as Norwich and Exeter, which on every count-value for money, clarity of services and accountability to the electorate-offer cheaper and better services for residents. You cannot do that and then refuse these amendments.

Lord Tyler: My Lords, I had not intended to participate in this debate, but I am moved by the eloquence of the Howarth-Hollis panegyric in favour of county unitary status, as that seems to be the sheer thread of their argument: unitary authorities-county unitary authorities, rather than city unitary authorities-avoid the duplication that has been referred to at such length.

Baroness Hollis of Heigham: My Lords, let me clarify one point. I spoke of unitary authorities, especially for cities. I do not have a particular commitment to what may happen in very large rural counties. I repeatedly made the point that I was talking about city services.

Lord Tyler: But the argument advanced by the noble Baroness and the noble Lord was much more applicable to counties.
	I was a member of Devon County Council in the long-distant past, when I was very young-I was 22. I then had the experience of seeing the County Borough of Torbay taken out of Devon. It was disastrous both for Torbay and for Devon. More recent experience that I have had would be more applicable and relevant to this debate. As a member of the board of the Devon and Cornwall Business Council until relatively recently, I was struck by the extent to which businesspeople in Exeter saw the value in the long term of a unitary authority for the whole county of Devon because Exeter is the county town of Devon. It is the natural centre, culturally, socially and economically, and has an amazing effect on the whole network of relationships in Devon. I speak not from personal experience of Norwich, but I think that my noble friends from that area would agree that it is similar in terms of being the county town of Norfolk. That may not be the case with other unitary authorities in other parts of the country.
	What I am absolutely clear about is that, in the terms set out by the noble Lord, Lord McKenzie, we are where we are. To reopen the issue at this stage as the duet have encouraged us to do would be absurd, entirely inappropriate and against the decision taken by this House just a few weeks ago. Certainly, it would be against the mandate given to both parties in the coalition just a few short weeks ago.
	There is a case for more unitary authorities. It was advanced extensively and deliberately for the county of Cornwall in recent months and I think that it will prove a success, but that was in different economic circumstances. To reopen this issue in the terms that the noble two over the way have suggested, at this stage, with this particular amendment, seems to me totally irrelevant and to show disrespect for the procedures of this House. It may be that in future there will be another case for looking again at local government in Devon and Norfolk. If so, we would need to look at the relative economics of a unitary authority for the whole of those counties-I am sure that this applies for the business communities in both counties-rather than simply reopening the issue of the status of Norwich and Exeter. But that is for the future. As far as today, this Bill and these amendments are concerned, I think that we should move on.

Lord Burnett: My Lords, I am delighted to follow my noble friend Lord Tyler, who was a very distinguished Member of Parliament for North Cornwall. It was a state secret, which I can now reveal, that in fact he was born in Devon, albeit very close to the River Tamar. I declare that I live in Devon and own residential and agricultural property in Devon and residential property in Exeter, where my law firm has an office. Most of us agree with the principle of unitary councils, but we do not agree with the proposals that are now being debated. We do not agree with a unitary Exeter. It is not only people from this side that are saying that; every independent outfit that has looked at the matter has said the same. The Boundary Committee, some years ago, during the tenure of office of the previous Government, made it quite clear that a unitary Exeter was unaffordable and did not meet the Government's criteria. The courts have thrown out the previous Government's proposals. This is a huge distraction and it is time to let matters proceed and let this Bill through as fast as reasonably possible.

Lord Howarth of Newport: Does the noble Lord regard it as significant that in no fewer than four opinion polls held in Exeter, by majorities of two to one the people of Exeter said that they wanted a unitary Exeter. Is that of no account to him?

Lord Burnett: What is most of account to me is the result of the last general election, in which the majority of the Member of Parliament for Exeter, having had the benefit of a Boundary Commission change and a far more favourable electorate, went down very considerably indeed. If my memory serves me right, the people of Norwich actually threw out their two Labour Members of Parliament. That is-

Lord Howarth of Newport: My Lords-

Lord Burnett: No, I am not giving way any more-the noble Lord has had his say. This is a distraction and a huge waste of money. We know the duplication that will occur and we know that economies of scale will be lost. Let us proceed with the Bill.

Lord Grocott: My Lords, having listened carefully to this debate, I am struck by two things. The first is that no one on the opposite Benches, especially not the three Lib Dem speakers, have in any sense argued in principle for a two-tier system. They have all said in varying ways that they support unitary local government but not at this moment, in these particular local authorities or at this time in the development of our economy. In principle, though, they all seem to be in favour of unitary local government; if they are not, no doubt they will intervene on me. I think that that is also the Minister's position, although she will be speaking in a moment or two. The arguments against are ones of pragmatism, relevant to the details of the moment.
	The other thing that has been striking is that this has been a theoretical debate. There has been no reference whatever to what has actually happened to those local authorities that took advantage of the changes made by the Conservative Government prior to 1997. I pay tribute to that Government again, as I did at Second Reading. I am enormously grateful to them for giving Telford unitary local government. That was done properly through consultation. Ministers discussed it with local MPs, as Ministers should. This is why I say-I did not think that I would get the opportunity to quote Nye Bevan in relation to this amendment, but it is the obvious piece of advice-"Don't look in the crystal ball when you can read the history book". That Conservative Government, to their credit, gave unitary local government to a large number of towns and cities, including Telford, as I said, which did not have the benefit that my noble friend referred to of having been a unitary local authority in the past. In that respect, it was a much bigger experiment in Telford than anywhere else and it has been a resounding success.
	If the door is now being closed to future applications for unitary local government, I appeal to the Government to look at the record to check those local authorities that were given unitary status by the previous Government to find out where in fact costs have escalated, a risk that a number of speakers have suggested, and to see whether people there now regret the decision that was made. The noble Lord, Lord Tyler, referred to Torbay. Obviously I do not know that area, so I am not trying to contest his evidence, but I would be interested to know, given that he described Torbay unitary authority as a failure, whether the people of Torbay are now petitioning to re-establish a two-tier system in Torbay.
	In my experience, all the evidence-from one town in one particular part of the country-is that, while there was strong opposition from the county to the establishment of unitary local government, as you would expect, the experience has been successful. The people of Telford are proud of the local authority, which has had both parties in control of it-there have been both Labour and Conservative administrations, so I am not being partisan when I say this-and there was all-party support for the application in the first place. This, together with all the other local authorities that have achieved unitary status, is valuable evidence that should be looked at before the Government shut the door on the possibility of any other local authority that wants the benefit of unitary local government achieving it.
	I appeal to the Government. I can see no reason why they would want to object to the amendment; it simply leaves doors open for the future. Even if they are determined to object to it, surely it is reasonable for me and others to ask them not to. It was, after all, a Conservative Government who established these local authorities. I, a dyed-in-the-wool several-generation supporter of the Labour Party, am saying that that was a good decision. What is more, I am saying that the evidence of the past 12 or 15 years is that it was a good decision and the Conservative Government were right to do it, as we were right to petition for it. Please do not close the door and please look in the history books.

Baroness Hanham: My Lords, we have had one hour's consideration of a matter which is nothing to do with this Bill. We have spent one hour listening to the noble Lord, Lord Howarth, and others giving us a treatise on local government organisation. That is not what this Bill is about. We have had one hour hearing about the merits of Exeter and Norwich. That is what this Bill is about.
	This Bill was introduced to stop Exeter and Norwich becoming unitary authorities. It was introduced because the previous Government went back on what they originally believed, which was that these unitary authorities were neither value for money nor would they be able to manage. Until a very late hour in December 2009-merely months before the election-the Government held that position. The Boundary Commission held the position that this was not value for money. The Merits Committee, chaired by the noble Lord, Lord Rosser-he has been very quiet about this today and on other occasions-drew attention to the fact that it was rotten value for money. Everybody who looked at these proposals up till the 99th hour said this was not value for money, and therefore should not be allowed until, amazingly, some compelling reasons arose. Those compelling reasons were not able to go out to consultation, which is what had been suggested that the judge said in his winding-up, because, clearly, there was not time before the election.
	I draw attention to the fact that this Bill has been superseded by the judgment of the court. The court has stopped these orders. No restructuring of Norwich or Exeter is allowed. It has been stopped and we have spent a whole hour discussing the situation. I would accuse the Opposition of filibustering if I did not know them so well. I know that the noble Lord, Lord Howarth, and the noble Baroness, Lady Hollis, like to give us the benefit of their full experience.
	We need to move on. This Bill is not about, and does not attempt to consider, the organisation of local government in general. The amendments try to interpose a possibility of that. If this Government decided on a reorganisation at any stage, I assure the House that they would not do it on the back of an amendment to this Bill which asks them to bring forward proposals within three years. I can tell the House that they would have a lot more authority than that if they ever wanted to do it. However, we still have the local government legislation of 2007 and it is perfectly right that those provisions have not been repealed. It is perfectly clear from the Bill we are considering that what is being stopped is any consideration of a reorganisation of a unitary authority, which encompasses Suffolk and Norwich and Exeter. The Bill is not about the reorganisation of local government; it is not a treatise on unitary authorities; and it does not discuss whether there should be two-tier or other government. I have lived in a unitary authority but there is no question of my unitary authority or any other unitary authority being worried about this Bill. Let us be clear: the previous Government reneged on what they believed, which was that those two unitaries were not viable or value for money. I do not know what made them go back on what they said-you may-but these amendments do not do anything for the Bill, they do not do anything for the organisation of local government, and they do not in any way persuade me to say that they are of any benefit at all, have any merit or have anything to do with the Bill.
	I have been asked a lot of questions and a lot of people have been quoted. The noble Baroness, Lady Eaton, is unable to respond at present because she has not made her maiden speech. She is extremely welcome as a Member of this House and it is unfortunate that someone should call into question something that she has said, when she cannot rise to speak for herself. Eric Pickles is not in this House, either.
	So I am responding for the Government when I say: stick to this legislation only, and let us not go into the wider field. If we are going to have reorganisation, then this Government will have the courage of their convictions and come back. At the moment, they have no intention of doing that, as far as I know; at the moment, they have no intention of allowing Norwich and Exeter to proceed; and they have no intention of accepting these amendments.

Lord McKenzie of Luton: My Lords, it goes without saying that I am disappointed by the response of the Minister. As has been the case on previous occasions, an amendment has engendered a debate far beyond its particulars. Let me say to the noble Lord, Lord Tope, that I greatly appreciated the contributions of my noble friends Lord Howarth and Lady Hollis about their experience. I very much share their views, although I accept that they went somewhat wider than the specifics of the amendment. I ask the noble Lord, whose argument is that we should not now be distracted by reorganisations, given the economic climate, to tell us how that fits in with his plans for the health service, the police service, education and much else.
	I say to the noble and learned Baroness, Lady Butler-Sloss, that this was genuinely not intended to be a wrecking amendment. It makes a straightforward proposition. The Minister has accepted that the 2007 provisions remain on the statute book and give an ongoing opportunity for the Secretary of State to invite proposals. That is good and we support it. All that this amendment sought was to put on the statute book a requirement on the Secretary of State to come back within a period of time during the course of the Parliament to say whether further proposals for unitary status are to be considered. The amendment does not require him to consider them, nor does it set out the criteria that he would have to adopt if he wished to go down that path. As I explained when I moved the amendment, we had to tie it to Norwich and Exeter in particular because the Bill was confined to them, but there is a broad principle here.
	At the moment, the Government's basic proposition is: no more unitary authorities during the course of this Parliament. That is despite what the Minister heard from around this Chamber about the benefits that unitary authorities can bring. However, we are entering almost a new era for local authorities-given the economic constraints and whatever our arguments and views on how those came about-which will have to be even more innovative by embracing new partnerships and new ways of commissioning. Is it therefore not right that the starting point for any particular local authority, whether it happens to be two-tier or unitary, is its place in the queue, and which could have a significant impact on its ability to deal with the challenges that will arise this year, next year and for some years to come?
	All that we are seeking here is to give the Secretary of State an opportunity to revisit the current judgment that he has made-that there will be no more unitary authorities-in light of actual experience on the ground and how those different types of authorities are coping with the new and constrained environment. We are not requiring him to change or to make any particular judgment, but are asking him simply to report back to Parliament to say whether the judgment that he has made now holds good in light of experience, not just in Norwich and Exeter but elsewhere. That would seem to be a very straightforward and simple request, which is not intended to wreck the Bill at all. It is just to give an opportunity for local authorities to have this revisited. Currently, if they are on the wrong end of what they perceive to be the right structure, they are stuck with that for perhaps five years, depending on how long the coalition lasts. This was an interim opportunity to get the Secretary of State to report to Parliament on these matters.
	Clearly, the noble Baroness does not want to accept the precise terms of this amendment-or accept it at all-but I was hoping that at least she would give some undertaking of an interim report to Parliament. That assurance might have been helpful: again, it was not an unreasonable request. However, I am conscious of the time and of the other matters that we have yet to discuss. I am genuinely disappointed by the Government's response, but I beg leave to withdraw the amendment.
	Amendment 1 withdrawn.
	Amendment 2 not moved.
	Amendment 3
	 Moved by Lord Rosser
	3: Clause 1, insert the following new Clause-
	"Expenditure
	There shall be paid out of money provided by Parliament any expenditure incurred by the Cities of Norwich and Exeter in connection with by-elections arising from the quashing by the Court of the Norwich and Norfolk (Structural Changes) Order 2010 and the Exeter and Devon (Structural Changes) Order 2010."

Lord Rosser: My Lords, I will speak to Amendment 3 now that it has been accepted, following further representations, that it is possible to table an amendment to the Bill that calls on central government to provide the money to cover the cost of the by-elections, likely to be £80,000 to £100,000 for each authority, which are due to take place in Norwich and Exeter in September following the quashing of the two orders.
	Holding the elections in September is of some significance, since it is a direct challenge to the Minister, who told me categorically in her letter of 8 July that:
	"the terms of office of one-third of the members of Exeter and Norwich city councils, which had been extended by the Orders, ended on 5 July and there will be by-elections to fill the vacancies within 35 days as required by statute".
	I asked the Minister in Committee which section of which Act of Parliament the Government were saying required these elections-which are for ordinary, not casual, vacancies-to be held within 35 days. I received no answer then, or in a subsequent letter from the Minister. I have received no indication from the Minister that she has reconsidered her statement of the law that,
	"there will be by-elections to fill the vacancies within 35 days as required by statute".
	Therefore, I assume that that is still her position.
	In Committee, the Minister said the following on the timing of the elections:
	"I understand that we have received no representations about it from the authorities and that they are taking their own legal advice".-[Official Report, 14/7/10; col. 720.]
	I will not comment on the accuracy of that statement since the Minister said that it was what she had been given to understand. However, my understanding is that, in response to the ministerial statement that they had 35 days in which to hold the elections, the local authorities asked the department to confirm the statutory basis that was referred to in the statement. I am told that after a few days, the department came back to say that the Minister stood by the statement and had nothing further to add. Some might think that a rather arrogant response. It was certainly unacceptable to the local authorities. On application by the two councils, following clear and emphatic advice from a QC, two judges in the Queen's Bench Division of the High Court confirmed that the local authorities' understanding of the law was correct and that the 35-day rule for casual vacancies did not apply. Accordingly, a date in September has now been fixed for the by-elections.
	In her letter to me of 8 July, the Minister also said that,
	"we recognise that any by-elections will involve the councils in additional costs".
	I asked the Minister in Committee what additional costs the Government had apparently decided that Exeter and Norwich councils should bear, and whether she was referring to their having to contribute the expenditure that they would have incurred had the council elections been held on the day of the general election, or whether she was saying that the councils would have to pay that much higher cost of running the elections this summer. In her response, the Minister stated that the local authorities must bear the cost of what had happened but she did not directly answer the question that I asked about what those additional costs were; nor, so far as I can see, was the issue addressed in her subsequent letter. However, her reply in Committee included the following very interesting statement referring to the forthcoming elections:
	"This is now a matter for the authorities. They now have to hold elections and if they do not know when to do so, they must seek their own legal advice".-[Official Report, 14/7/10; col. 720.]
	Perhaps I may point out to the Minister, and in particular to her Secretary of State, that it would appear that it is not the local authorities in Exeter and Norwich that do not know the law on when these elections should be held; rather, it is Mr Eric Pickles, who, despite his local government experience, does not know what he is talking about. It is really quite something to have a Secretary of State for Communities and Local Government who presides over a department that writes letters at his behest with statements about the law on the timetables for by-elections that local authorities must follow which are just plain wrong.
	The reason I say that the Ministers in this department do not know what they are talking about is that the legal opinion which Norwich and Exeter felt compelled to seek in the light of the Secretary of State's dogmatic assertions stated quite bluntly that the Secretary of State was wrong. This would appear to be the position of the High Court, which determined that 9 September-which by any reckoning is somewhat more than 35 days after 5 July-should be the date for the elections, as the local authorities requested.
	Frankly, what has happened seems to fit the new culture that Mr Pickles has brought to the Department for Communities and Local Government. In an interview in the latest edition of Total Politics, he said:
	"The last thing you want ... is if you marched folk up the hill and somebody 'coughs' and you have to march down again ... I needed to be absolutely certain that when I said something, it was never going to be contradicted".
	Mr Pickles' statement about these by-elections having to be held by statute within 35 days has apparently just been contradicted-and contradicted through a judicial decision. However, perhaps the judges concerned should be wary, particularly if cigar-smoking is their favourite pastime, as Mr Pickles also stated in the interview:
	"The cigar-chomping Commies are not going to take over on my watch".
	Exeter and Norwich have incurred additional costs as a result of the dogmatic and incorrect statements of the law on the timescale for these elections by the Secretary of State, who has made it clear that, so far as he is concerned, once he has said something, it will never be contradicted. I feel for the noble Baroness, Lady Hanham, who I suspect is the ministerial voice of reason in the department. I hope only that the Secretary of State does not come to look on her as a potential cigar-chomping Commie.
	So far as I can make out, Exeter and Norwich appear to believe that the additional costs they have incurred are some £5,000 each as a result of having to seek a legal opinion and go through court proceedings to establish a legally watertight date for the by-elections in the light of the Secretary of State's intimidating and incorrect statement that by statute they had to be held within 35 days, which would have been at the height of the holiday season. What is the Minister's reaction to that? The local authorities in Norwich and Exeter have been in no way at fault. To them and to everyone else central government does not become some new or different body or organisation simply because there is a change in political control, any more than a local authority becomes some new or different body when there is a change in political control at that level. Indeed, Mr Justice Ouseley said in the High Court-and perhaps he said it with a twinkle in his eye-that the local authorities are,
	"not themselves to blame for the pickle",
	in which they find themselves".
	Now that he has been the direct cause of the two local authorities incurring additional expenditure over these by-elections, just as he has argued the previous Government were, is the Secretary of State, Mr Pickles, now prepared to accept that, central government having got it wrong and the local authorities, as Mr Justice Ouseley said, being in no way at fault, central government should pay the costs associated with the holding of these by-elections?
	I hope that the Minister will accept this amendment, which is about fairness to the two local authorities in question, and fairness is what the coalition Government say they stand for. I beg to move.

Baroness Hollis of Heigham: My Lords, I support the amendment moved by my noble friend Lord Rosser. Time after time in this saga, we have had erroneous or misleading or missing advice from the Department for Communities and Local Government. Not only has that contributed to the mess we are in; it has also contributed enormously to the cost to Norwich and Exeter-which, I emphasise, have behaved impeccably, legally and lawfully every step of the way. They are the innocent parties in this. They responded to an invitation, which was approved, and then found themselves in this quagmire. As my noble friend has quoted, on 5 July, when talking about the by-elections, Mr Justice Ouseley referred to the,
	"preferred option of the interested parties"-
	Norwich and Exeter-
	"who are not themselves to blame for the pickle in which they find themselves".
	I repeat, as did my noble friend, that the judge was quite clear that Norwich and Exeter were not to blame.
	By implication, therefore, much if not all of the responsibility lay at the door of the department-which has continuously given faulty, erroneous, misleading or missing advice. According to the judge, in December 2009 and January 2010, the department could and should have sent out a letter notifying the four interested parties that there were additional considerations to be taken into account. That, says the judge, would have met his concerns and there would have been no quashing of the orders. That letter did not come. I cannot believe that my right honourable friend in the other place would have refused to send out such a letter had he been advised of its prudence.
	We then had a Bill that was so loosely drafted by the DCLG that it was arguably hybrid. However, as that was never argued before the examiners, for by then we had the court ruling, the argument that it was hybrid went effectively by default. Given the court's judgment, councillors who had legally not stood for re-election last May now found themselves unseated. However, the court action was taken by Devon and Norfolk against the DCLG, not against Norwich and Exeter. Norwich and Exeter were, if you like, interested parties. The action was taken by the two county councils against DCLG. If, as the judge says, Norwich and Exeter are in no way to blame for this and they have been innocent parties throughout, why should they pick up the bill?
	It seems profoundly unfair that Norwich and Exeter-which have behaved impeccably and legally throughout, as the judge has confirmed-should pick up the bill for the DCLG's mistakes. I cannot believe that any of your Lordships would think that that is right, fair or proper.
	With such a litany, I should hope that the Minister will take this back and ask her department to think again about the moral propriety of shrugging their shoulders and saying, "Tough, Norwich. Tough, Exeter. You've behaved legally, properly and innocently throughout but you'll have to pick up the bill for our mistakes". I have never known such a casual attitude in government to the assumption of responsibility. I very much hope that the noble Baroness will respond to my noble friend's amendment.

Baroness Butler-Sloss: My Lords, I have one point to make on this. At the preliminary hearing, Devon and Norfolk asked for an expedited hearing so that these matters could be dealt with before the election. The two cities said that they would prefer the risk of by-elections to an early hearing by the court. So much if not all of this has been brought upon Exeter and Norwich by asking the judge for the case to be delayed until after the hearing.

Baroness Hollis of Heigham: May I just-

Noble Lords: Order!

Baroness Hollis of Heigham: On a point of information-

Baroness Anelay of St Johns: Perhaps I may assist the House. This is Report. If the noble Baroness, Lady Hollis, wishes to keep to the rules of Report laid down in the Companion, I suggest that she ask the noble and learned Baroness, Lady Butler-Sloss-before the noble and learned Baroness sits down-to make a clarification, but that the noble Baroness does not ask further questions or make any further statement on her own behalf or on behalf of others.

Earl Cathcart: My Lords, I remind the House that I still live in Norfolk, have been a district councillor for more than 10 years and am chairman of my parish.
	The audacity of this amendment is breathtaking. It requires this Government to pay 100 per cent of the costs of the impending by-elections arising from the judge declaring that the orders forced through by the previous, Labour Government were illegal. Why should this Government pay 100 per cent of the costs? Indeed, why should they pay anything at all? If the amendment were accepted, Exeter and Norwich would be making a profit as, within the grant that local authorities receive, an amount is already paid to them to defray the costs of their local elections. Had the elections taken place when they should have on 5 May, Exeter and Norwich could have piggybacked on to the general election, and would have been charged only their fair share of the total cost-about half. In any event, the city councils should have built the costs into their budget and set aside the money, as they could not possibly have known when the general election was to be held.
	Why should this Government be responsible for the illegality of the previous, Labour Government? It is not as though the election costs come out of the blue. There was plenty of warning, and both city councils were fully aware for months of the risks if the orders were quashed and that by-elections would be needed. In forcing the orders through, a calculated gamble has been taken, even though the clearest of warnings had been given that the odds were stacked against them. First, as was said by the noble and learned Baroness, Lady Butler-Sloss, both Norfolk and Devon county councils asked for an expedited hearing in the High Court, so that a judgment could be made one way or another before the planned elections were cancelled. However, Norwich, Exeter and the Treasury Solicitor argued against that on the basis that they would have insufficient time to prepare their case, and that it would not be problematical to have by-elections anyway.
	Secondly, several Members of this House raised this problem repeatedly, urging the Labour Government to delay the orders until after the judicial review, to avoid depriving the electorate of their vote and avoid any unnecessary additional costs. Thirdly, the Permanent Secretary, in uniquely seeking a ministerial direction, warned that the judicial review against the orders had a high likelihood of success.
	Fourthly, even the Merits Committee, chaired by the noble Lord, Lord Rosser, warned of the problems. The summary of the committee's report stated:
	"We also draw the House's attention to the intention to cancel forthcoming council elections in each area".
	The report continues:
	"The House may also wish to give serious consideration to a number of questions about the decision-making process ... The Orders have been laid very close to the date of the council elections: will the timing affect local democracy in those areas?".
	That was the Merits Committee report.
	Fifthly, at the preliminary hearing in February this year, I understand that the courts brought the problem to the attention of the city councils, four weeks before the orders were passed. Sixthly, the Joint Committee on Statutory Instruments report concluded that if the orders were approved,
	"there will be a doubt as to whether they would be lawfully made; that in one respect in particular they would represent an unexpected use of the power conferred by the enabling Act; that in one respect their purport requires elucidation; and that in one respect they fail to accord with proper legislative practice".
	The unexpected use of the power conferred by the enabling Act, to which the Joint Committee refers, is the cancelling of the city council elections due to be held on 6 May. As the committee pointed out:
	"If the court decides that the decisions to implement the unitary proposals were flawed ... it will be too late to restore the elections which will have been cancelled".
	Seventhly, and finally, just weeks away from the general election, the Labour Government were only too well aware of the manifesto commitment from both opposition parties that they would overturn the orders.
	Despite all those warnings, the party opposite forced through the orders, orders that were subsequently held to be illegal. The two city councils are not the victims in all this. Indeed, they were complicit in the whole shoddy business. They were prepared to take the gamble, even though they knew that the cards were stacked against them and knew the consequences if they lost. They had been clearly spelt out to them on several occasions, and they must now pay the price.

Lord Low of Dalston: My Lords, I am not an expert on local government, or even on all the issues at stake in this case, so I do not want to get embroiled in the merits or otherwise of unitary authorities. However, I have observed, sitting here listening to the debate, that the matter is highly contentious, highly politicised and gives rise to considerable passion. I just want to make one point to the Minister which is perhaps appropriate to make from the Cross Benches, which she may feel that it would be the course of wisdom and statesmanship to listen to.
	The Government have won this battle. Perhaps they should not press their advantage to the point where they are seen to be simply riding roughshod over the Opposition. The Minister may feel that it would be the course of statesmanship to help to create an environment in which passions could be allowed to cool and a legacy of bitterness was not built up. In order to do that, she might feel that it was the course of prudence to accept the amendment.

Lord Rennard: My Lords, in responding to the comments of the noble Lord, Lord Low, I simply point out that the arguments about the costs of by-elections now to be held in September illustrate one of the many reasons why it would have been far better to have approved the fatal amendment tabled by my noble friend Lord Tope in March than to have proceeded in the way that we have. Had that amendment been approved that night, it would have stopped the orders then. The subsequent unnecessary costs, which are still being incurred, could have been avoided.
	Central to the whole debate are the claims made about the so-called compelling reasons that led the previous Government suddenly to change the criteria for considering these issues-and to act unlawfully by failing to give notice of their change, thereby avoiding consultation on the new criteria-and to try in the last few days in office to steamroller through proposals that they themselves had previously rejected. The only compelling reasons why the previous Secretary of State acted as he did was the certainty that his Government were about to lose office and the urging of the Norwich and Exeter local councils. The then Secretary of State ignored the clearest possible warnings that his course of action was illegal.
	As the noble and learned Baroness, Lady Butler-Sloss, has pointed out, when Norfolk and Devon county councils asked for an expedited hearing in the High Court so that the issue could be resolved before the local elections and before we got to this problem, this was opposed by the Department for Communities and Local Government and by both city councils. It is clear to me-I attempted to table a further amendment during consideration of the orders-that the orders should not have proceeded without the judicial review having first been properly considered, because they were very different from other orders; they were the only orders for which the department's senior civil servant had to write to the Minister to say that the judicial review was very likely to succeed.
	As the noble Earl, Lord Cathcart, has pointed out, the Merits Committee and the Joint Committee on Statutory Instruments both warned strongly about the dangers of proceeding, but the advocates of the proposed Norwich and Exeter unitary authorities, including Norwich and Exeter councils, chose to ignore all this and must therefore accept responsibility for the way in which they behaved.

Baroness Hanham: My Lords, I can say simply that I will not accept this amendment. I have heard once again all the arguments in favour, and I have listened to the noble Lord, Lord Low, very carefully. Statute is for interpretation. The fact is that these two authorities have landed themselves in a situation in which elections are needed. They have known from the outset that if things went this way, a third of their councillors would be disbarred from the moment the decision was made and elections would have to follow. They chose to seek legal advice on whether those elections should be held, and I understand that it has now been agreed that they will be held on 9 September. They will form a normal part of proceedings. The only additional expense will, I understand, be in the manning of the polling stations, which they would have to do in any event when elections are held. It is not for the Government to pick up this bill. The local authorities, even in these difficult circumstances, have the money to do so, so I do not accept the amendment.

Lord Rosser: My Lords, I thank all noble Lords who have contributed to this debate. I am sorry that the Minister has felt unable to move on this, particularly in the light of the comments made by the noble Lord, Lord Low of Dalston.
	As I mentioned earlier, the Minister said in Committee that she had been given to understand that no representations on the timing of the by-elections had been received from Exeter and Norwich councils. My understanding, as I said, is different. I notice in her response that she did not comment on that issue. I hope that she will make further inquiries on this point, particularly in the light of the response, which I am informed was given in reply as a ministerial stance and which once again reaffirmed the Minister's position. So far as I am concerned-and the Minister did not seek to refute this from the Dispatch Box just now-the statement of the law on the timing of these by-elections was incorrect. The facts, including the recent High Court judgment, also indicate that the Secretary of State's ruling on the law was wrong and that it has led to additional costs as far as Exeter and Norwich councils are concerned.
	I simply repeat that the local authorities in Norwich and Exeter have been in no way at fault, as Mr Justice Ouseley said in the recent decision of the High Court. He said that the local authorities,
	"are not themselves to blame for the pickle",
	in which they find themselves. As I have said previously, to Norwich and Exeter, and to everyone else, central government does not become some new or different body or organisation simply because of a change in political control. The same of course applies to local authorities.
	I hope that the Minister might be prepared during the next few weeks to reflect further on this issue and on the stance, which I suspect the Secretary of State in reality is taking rather than the Minister, and that she might be at least prepared to indicate to the two local authorities concerned that, without any commitment to change her stance, she would nevertheless, if they so wished, be willing to meet them to hear what they wanted to say to her on costs.
	It will be up to others to decide whether to pursue this issue further when the Bill reaches the other place, but as far as the proceedings in your Lordships' House are concerned, I beg leave to withdraw the amendment.
	Amendment 3 withdrawn.
	Clause 2 : Extent, commencement and short title
	Amendment 4
	 Moved by Baroness Hollis of Heigham
	4: Clause 2, page 1, line 14, leave out subsection (2) and insert-
	"(2) Subject to subsection (2A) this Act comes into force on such day as the Secretary of State may by order appoint.
	(2A) No order may be made under subsection (2) until the Secretary of State has made, in respect of each area for which a relevant order had been made under section 7 of the 2007 Act, a budgetary and financial planning order.
	(2B) A budgetary and financial planning order made under subsection (2A) shall require the County council in the area concerned to provide the district council periodically with budgetary and financial planning information including-
	(a) disaggregated expenditure and income data for the services it provides and the activities it undertakes with the district council,
	(b) a fully disaggregated medium term financial plan for all its services and activities within the district council.
	(2C) A budgetary and financial planning order under subsection (2A) shall specify the date by which the first information must be provided, and the frequency of subsequent provision of information.
	(2D) A budgetary and financial planning order under subsection (2A) shall be made by statutory instrument."

Baroness Hollis of Heigham: My Lords, the Minister has kindly written to those of us who participated in Committee and challenged her assessment of the costs and savings of Norwich and Exeter going unitary, and we are grateful. This amendment seeks to build on her information and take it forward to build the partnership that she in previous discussions and, today, the noble Lord, Lord Tope, have called for. In the impact assessment, at Second Reading and in Committee, the Minister regularly referred to the £40 million of transition costs and how these were unaffordable. That has been repeated again today.
	When intervened on because the £40 million took no account of savings, the Minister said:
	"I refer to gross costs because that is what we are talking about".-[Official Report, 14/7/10; col. 709.]
	It was of course what the Minister was talking about. It was not what we are talking about and in public policy terms makes no sense whatever. What matters is not gross costs, but net costs.
	Let me give a simple example. Someone's water rates are, say, £100 a year. A meter costs £100 but would reduce the bill by half to £50 a year. After two years there would be a continuous saving if you went from being on the rates to having a meter. Would the Minister really say that the only figure that mattered was the gross cost-the £100 cost of the meter-say that it was unaffordable and refuse to fit the meter to reduce costs even though she could recover the cost in savings, the payback time, in just over two years? Of course she would not; nor would anyone in this House. If necessary, she would spread the cost of the savings over the two years. She certainly would not tell us to share the house with another family so that in partnership we split the full water rates bill between us. The decision surely to fit the water meter we would all think is a no-brainer.
	I ask noble Lords to forgive the analogy, but essentially that is what the Minister is doing here. She is not going for the straightforward option of calculating net savings with the purchase of a water meter, but suggesting that house sharing might possibly achieve the same effect. That is the position of the two authorities.
	The Minister said in her letter of 22 July that the cost of creating a unitary Norwich during the transition period to 2014 would be £20.1 million and that savings for the same transitional period would be £22 million. From year two onwards, the Minister has identified savings, by full rollout, of almost £4 million a year. So there would be net savings over the first four to five years of nearly £2 million, and thereafter annual savings of nearly £4 million a year to be achieved by a unitary Norwich. In other words, the savings made by fitting a water meter would kick in at year two and it would have more than paid for itself by year three or four. Frankly, in all my time as a Minister, that is as good a return on capital in terms of investment to savings that I can recall. On the Minister's own figures set out in her letter, savings would outpace costs after year two and thereafter would produce annual savings of £4 million a year.
	Going for the water meter does more that. It would encourage people to save water by putting a brick in the loo cistern, by taking showers, by keeping a water tub, and by avoiding watering the lawn. In the same way, having a unitary authority with clear accountability and transparency so that everyone in Exeter and Norwich knows who is doing what to which price and a known standard under the pressure of full democratic accountability, increases effectiveness and value for money. That is something we all want. But what is the Minister proposing instead? It is not the water meter, the sure way of ensuring value-for-money services-that is, structural reorganisation-but what is effectively house sharing in order to halve the water rates. Or, as she says in her letter, the £40 million upfront costs can be avoided and the savings, which so far outpace the costs, can be made not by going unitary but by house sharing; that is, by "having good, co-operative partnerships". I shall quote from her letter again:
	"Our clear case is that savings of this magnitude and more are achievable by effective collaborative working between the city council and the county in each case. Hence, by stopping the unitary councils, the net result is simply to save £40 million".
	For the Minister, the gross costs and the net costs are the same because the likely savings can be achieved another way, so the water meter is not necessary. The Minister's entire value-for-money case, repeated today by the noble Lord, Lord Tope, rests not on savings that would come from a unitary Norwich, but from a collaboration between two polar opposite authorities: one a tightly drawn city council and the other a very large rural county council.
	One is left of centre and the other is right of centre. The city has problems of density and the rural county has problems of sparsity. One has urban service needs such as street lighting, litter, refuse collection, policing and late night rowdiness, homelessness and the deprivation of large council estates. It is also the city's duty to maintain its heritage buildings and amenities, as well as supporting its business heart which provides half the jobs in Norfolk. Let us compare those pressures with the pressures faced by Norfolk, and I speak as a former Norfolk county councillor. The county has a huge road network which is expensive to maintain. There are small rural schools which are uneconomic because in order to offer teaching of a good enough quality they need considerable subsidies, but without which villages might die. Norfolk needs to support rural transport, shops, pubs and post offices, and must provide peripatetic services for the elderly, the disabled, the housebound, the car-less, women, children and the fragile. Norfolk's rural needs are as real and as proper as those of the city of Norwich, but they are totally different. How does the Minister think we can share services sensibly and reduce costs by intelligent collaboration when, rightly and properly, the focus of the county is on rural needs and the focus of the city is on urban needs? That is what local government is about: the distinctiveness of place.
	It would be hard enough for such a partnership, with legitimate differences in perspective, if it was forthcoming and willing, even though the priorities might well be different. But what happens to the alleged £40 million in savings that the noble Baroness and the noble Lord, Lord Tope, have insisted are available when that partnership is not forthcoming; when the house sharing of a water meter is not on the table? The Minister knows-we have told her-that during the process of following the earlier orders to construct unitary authorities, the counties refused to co-operate and withheld the information we needed. They refused then to do what the Minister says they should do now. We asked for information but answer came there none.
	The entire case of the Minister and the noble Lord, Lord Tope, is based on the assertion that sufficient savings can be made by voluntary partnership as would occur under unitary reorganisation. When I pressed the Minister in Committee on how we could deliver that partnership if we were denied the information-as we have been so far-on which intelligent co-operation was built, the Minister said, metaphorically, that that was our problem, not hers; that it was not for her to interfere. I think she would agree that she said that. Yet it is the Minister-not us-and no one else who is saying that we could get similar savings to reorganisation by collaboration. The Minister's letter makes it clear what the savings would have been if Norwich and Exeter were to be unitary and she insists that those savings could be found by voluntary partnership. Our experience so far is that voluntary partnership is not available to us because the information is withheld and the Minister has said, "Not my problem"-and yet this is the Minister's strategy to us which she is failing or refusing to back up with an ability to deliver.
	I take it that the Minister wants to make those savings, as we all do, but how are we going to achieve them if the information is withheld and the Minister will do nothing to ensure that that information flows? If that information is not forthcoming through partnership, the Minister will have denied the public purse and the local taxpayers the proper savings which, as I said on an earlier amendment, would have come to every household in Norwich of around £100 a year. When local authorities are facing cuts in services and a possible rise in council taxes, if the Minister is going to deny the residents of Norwich those savings, she must be in a position to help us to achieve the alternative route she has offered of collaboration and partnership. If the two cities, Norwich and Exeter, do not get, as the amendment calls for, disaggregated financial statistics on which to build partnerships, the Minister will have cost Norwich and Exeter citizens each some £3 million to £4 million a year. She will have refused the certain savings coming from unitary status and have replaced them with hypothetical savings coming from partnership, and then walked away when even those hypothetical savings were not delivered because the information base on which the partnership rests was not shared. Hence the amendment.
	I understand that the Minister cannot impose willing partnership on reluctant conscripts. She does not have that authority and cannot therefore do so in legislation. However, she can require the counties to divulge the financial information. These are public statistics, held in a neutral way by the county council, which the citizens of that county and city are entitled to know; we are talking about public information. She could require the counties to divulge the financial information on which joint arrangements can be built.
	Essentially, the amendment seeks to put words in the Bill to reflect the sentiments that the Minister and the noble Lord, Lord Tope, have uttered today. It requires the county council to break down financial statistics by district and to share that information so that the activities the county undertakes within and with that district council are known and transparent. That is the way in which we get decent services between housing and social services for the elderly and frail people who wish to remain in their own homes; that is the way in which we avoid duplication on economic development and seek to continue to attract jobs to Norfolk.
	The amendment requires publication of information that the county must already hold. With it, we may be able to attempt constructive partnership; without it, we do not have a chance. What objections should there be to making such information available? Why should those figures-public information about money-not be in the light, rather than be kept in the shadows? Why are the council tax payers of the city not entitled to know how their money is being spent?
	I hope that the Minister will accept the amendment. If she means what she says, and I have no doubt about her integrity on this point, and the savings of £40 million and more-£4 million a year-can be achieved by voluntary partnership rather than reorganisation, which was the point made by the noble Lord, Lord Tope, she must ensure that both authorities have the relevant financial information on which to construct those partnerships. If that information is withheld, all that we have heard today from the Minister and the noble Lord, Lord Tope, will be pious platitudes. If they mean what they say, and the citizens of Norwich and Exeter can be spared an extra £100 or so a year in council tax, they will support the amendment. I beg to move.

Baroness Shephard of Northwold: My Lords, I declare an interest as a lifelong citizen of the county of Norfolk, as a former Norfolk county councillor who on one occasion represented a city division, and as a former Norfolk Member of Parliament. I shall be very brief.
	The thrust of the amendment was extensively debated in Committee. On that occasion, we were given by the noble Baroness, Lady Hollis, a very bleak picture of the lack of co-operation between Norfolk and Norwich. I recognise her passion for an independent Norwich. It is not new, and it has been sincerely held for a very long time. I believe that co-operation between the city and the county has been difficult, not least because of the four-and-a-half years of protracted administrative chaos and uncertainty that have arisen from this whole unitary business introduced by the previous Government.
	There have been profound disagreements on each side of the city ring-road, also affecting other districts in the county. However, there are 13 city councillors and 13 county councillors who represent divisions in Norwich, as I once did. There are nine, 10 or possibly more committees and bodies which require co-operation between city and county. Indeed, the work of the Greater Norwich Development Partnership, where the city and the county work together with two other district councils, has been commended by the Audit Commission as providing an extremely good example of joint working.
	It is a mistake to ask government to legislate for people to get on with one another. It should surely be in the interests of those who elect councils that those councils are accountable to their voters and not to other councils. I accept the responsibility that perhaps I have within the county of Norfolk to persuade this co-operation to continue in the interests of everyone in Norfolk and Norwich. I hope very much that the noble Baroness and the noble Lord will accept the same responsibility and not try to shift it on to the Government.

Baroness Hanham: My Lords, I thank the noble Baroness, Lady Shephard, for her contribution, because she has summed up very clearly what the attitude ought to be about this. It is not government business to try to ensure that counties and districts get on together; nor is it government business to ensure that just one or two authorities are required to provide financial information. Public information is public information; if it cannot be obtained under normal freedom of information rules, there are ways of making sure that you get it. What worries me about how the noble Baroness, Lady Hollis, has put this forward is that she seems to be suggesting that there are such desperate animosities between the city and the county that it is absolutely impossible for this to work. I do not believe that in democratic government it is impossible for authorities to work together in a common cause.
	The noble Baroness also said that I have said that savings must come now rather than through a reorganisation. Indeed I have, and that is not confined to Norfolk and Norwich. It is going to be a general view and a general situation across the country that serious savings will have to come. If we are talking about £6 million a year-I think those are the savings that it was suggested would be made-within that confine, the amount that has to be provided may be within those regions and it may not. Yet savings will surely have to be made in co-operation with Norfolk to ensure the preservation of services and the local community.
	I am not going to accept the amendment. As I said on another amendment, the Government do not have any role in this. I hope only that people will hear what we say: that there will be have to be good co-operation at all levels of government over the coming months and years to ensure that, one way or another, we scramble out of this terrible financial situation in which the previous Government left us.

Baroness Hollis of Heigham: My Lords, we have had two contributions from the noble Baroness, Lady Shephard, and the Minister, who both make the same point-that government cannot legislate for local authorities to get on with each other. I completely agree, but that is not what this amendment does. They have answered a wider point about city and county relationships but not addressed the substance of the amendment, which asks for disaggregated financial information so that the city has the same information as the county has about the network of services that the county provides within the city-and, if the county wishes it, vice versa. That is all.
	No one is legislating for good will. That is impossible-of course it is-but I am not even calling for that. I am calling for the financial information that local authorities and their citizens are entitled to have in order to review and provide effective delivery of services. If we do not have information, we cannot make the savings that we want. I agree with almost everything that the noble Baroness, Lady Shephard, said, but it was beside the point. I agree with most of what the Minister said-except that she will not accept the amendment-but that was beside the point. The amendment says that the county must provide this information. What does the Minister suggest? FOI. I suppose that we could down 150 requests for freedom of information to drag out of the county information that should be brought to light for the city. That is what we are talking about-financial information. It is right that you cannot legislate for goodwill partnerships, but how can we build effective value for money and make the savings that the Minister insists can be made this way, rather than by reorganisation, if we do not have that information? Can I please be told how we can do it? We cannot. We have had no answer from the Minister or the noble Baroness, Lady Shephard, although I agree with every word that she said. Therefore, I want to test the opinion of the House.

Division on Amendment 4
	Contents 89; Not-Contents 183.
	Amendment 4 disagreed.

Biodiversity
	 — 
	Question for Short Debate

Tabled By Baroness Miller of Chilthorne Domer
	To ask Her Majesty's Government how they will halt the decline in biodiversity in the United Kingdom; and what resources will be allocated to that work.

Baroness Miller of Chilthorne Domer: My Lords, I start by offering heartfelt thanks to all noble Lords who feel strongly enough about the great importance of biodiversity to stay and speak in this debate as the last business on the last day before our Summer Recess. I know how much we all look forward to heading off for the summer, as it is a great chance to get out and about and see some of the wonderful species that might be mentioned today, whether peregrine falcons on the cliffs or horseshoe bats. I find it just as much of a thrill to see some of the less rare but no less exciting species such as swallows, sundews in upland bogs capturing flies or just peacock butterflies on the buddleia. I declare an interest as a vice-president of Wildlife and Countryside Link, a member of various wildlife trusts and the Marine Conservation Society and a vice-president of the Council for National Parks.
	For several years I have felt very gloomy about the outlook for many species, as no doubt have many of your Lordships. However, I am tempted to feel a bit more cheerful today given the amount of activity that is now going on, so I shall start with reasons to be optimistic. First, it is the International Year of Biodiversity, in which the United Nations has agreed to create the Intergovernmental Platform on Biodiversity and Ecosystem Services. That is certainly needed given the extent of the biodiversity crisis, the evidence for which was presented in the third edition of Global BiodiversityOutlook, which made pretty gloomy reading. Although my Question concerns the UK, and the rest of my speech will concentrate on that, I would like the Minister to mention what preparations the UK is making for the meeting in Japan in October and what sort of contribution it will make.
	As I say, I shall concentrate on the UK. My second reason for being optimistic is that this week we saw the publication of the discussion paper preceding the White Paper on the natural environment. I am pleased that our Government have chosen to make this a very early priority. The emphasis given to biodiversity in the White Paper will be extremely important and will lay the ground plan of work for years to come.
	The third reason for feeling optimistic is Sir John Lawton's report Making Space for Nature, which the previous Government commissioned. This Government will continue to take on board what Sir John's final report says. His update in March reported that to achieve a coherent and resilient ecological network we will need to look beyond existing designated sites and take account of landscape designations, local wildlife sites and green spaces.
	There are terrific examples of partnership work to build on. I give as an example the Great Fen, a collaboration between Natural England, the Environment Agency, the local wildlife trust and the district council, which joins two national nature reserves and creates more than 3,700 hectares of wildlife habitat. That will bring multiple benefits, not just in biodiversity but in water quality and recreation for local communities. There are multiple benefits from thriving biodiversity, as other things are kept healthy. That lesson runs through a lot of the recently produced work.
	That leads me to my fourth reason to be optimistic: the Economics of Ecosystems and Biodiversity study published on 13 July. This is a major international initiative that draws attention to the global economic benefits of biodiversity and highlights the growing financial costs of biodiversity loss and ecosystem degradation. It provides scientific and economic evidence of what many of us previously had only a hunch about. Incidentally, one interesting thing that the report highlights is that more than 50 per cent of chief executive officers in Latin America and 45 per cent of CEOs in Africa believe that declines in biodiversity are a challenge to business growth. In contrast, only 20 per cent of CEOs in Europe feel that it is an issue. There is some education of the business sector still to do here.
	My final reason for optimism is the report of the European Environment Agency, which talks about the important opportunity to address the shortcomings in the agriculture sector that further CAP reform will offer in terms of biodiversity.
	I move on to reasons to be pessimistic. The first relates to history. There have been plenty of efforts by many Governments to legislate in this area. There is the Wildlife and Countryside Act 1981, the Countryside and Rights of Way Act 2000-I am glad that the noble Baroness, Lady Byford, will speak in this debate, because she and I worked hard to put the biodiversity duty into Part III of that Act-and the Marine and Coastal Access Act 2009. I should be grateful if the Minister mentioned something about how implementation of that Act is going, especially the designation of MPAs.
	The second big reason to be pessimistic relates to the biodiversity indicators published in May, which show that there is still plenty of bad news around, especially for farmland and woodland birds. That relates partly to farming practices. For example, the switch from spring-sown to autumn-sown cereals resulted in a dramatic reduction in skylark chicks. There have been further losses of habitat, including ancient woodland, which is irreplaceable. The Woodland Trust estimates that in the past 10 years we have lost nearly 500 acres of ancient woodland and that 400 hectares-roughly 800 acres-in some 200 woods are still under threat. We have lost further ground in terms of the butterfly population. The results are very mixed. We have made a few gains, so it is not all bad news. However, we do not seem to gain much ground, despite the fact that resources were put into this area. Against a background of cuts in funding, that looks pretty difficult. However, it is not always bad news. At one time, cuts meant that verges were not trimmed so much; the effect on wild flowers, insects and small mammals was almost instantaneous.
	Too much tidiness is partly to blame. Gardens are often sterile paved areas, with all the fallen wood cleared and buildings with no nooks and crannies. The old Christmas card favourite of a robin nesting in a rusty watering can would not be easy to find any more. Municipal tidiness is also an issue. Canalised streams and rivers, with their habitat-free concrete sides, are very bad for biodiversity and a very poor way to deal with heavy rainfall, because flood waters sweep through canalisations. I am glad that the Environment Agency, among others, is doing much to reverse this work, to the benefit of biodiversity and flood management. Nottingham City Council is an interesting example. It has created wildflower meadows in an effort not only to improve biodiversity but to reduce the carbon footprint and address flooding issues by absorbing more water run-off.
	My final two points concern education. If our next generation does not understand the value of biodiversity, it will not protect it. The Countryside Alliance has just published a strong suggestion for the Government with many reasons why the education of our next generation is falling short. There are not enough school trips and not enough use of the outdoor classroom. We must address that and I would be glad of the Minister's comments.
	My final point concerns public involvement for everyone. This week, we have the Big Butterfly Count, organised by Butterfly Conservation and sponsored by Marks & Spencer, which gives us all a chance to get out and count butterflies. We had the RSPB bird count earlier in the year, while Pond Conservation has the Million Ponds Project, which is going well. A pond, no matter how small, is an exciting example of something that individuals, schools and local authorities can all create.
	I ask the Minister how we can begin to improve biodiversity against a background of cuts. My first move in the Recess will be to visit the newly opened Angela Marmont Centre for UK Biodiversity at the Natural History Museum, which is a hub for all us amateurs who would like to know and contribute more. That will be tremendously exciting.

The Earl of Selborne: My Lords, we are all grateful to my noble friend Lady Miller of Chilthorne Domer for giving us the opportunity to consider biodiversity loss. As I listened carefully to her, I decided that she erred more on the side of optimism than pessimism, and I agree with her on that, although clearly there are causes for both. I tend toward optimism at the UK level, but at the global level I take a different perspective. Like her, I start by declaring an interest. I am a farmer and I chair the Living with Environmental Change Partners Board, which is a research collaboration across departments, research councils and agencies. I am a member of the Wildlife Trust and I am proud to be the patron of Pond Conservation, to whose Million Ponds Project my noble friend referred.
	The question for debate this afternoon refers to halting the decline in United Kingdom biodiversity, but it is important to set this in an international context. This country is committed to halting its decline through the Convention on Biological Diversity, to which we were one of the earliest signatories. The target set in 2002 for this year, 2010, is going to be a failure, as we shall not get anywhere near it in global terms. In other words, leaders set up targets which were simply not deliverable, and there is a message there that we have to think about carefully.
	The causes of biodiversity loss are habitat change, which is often caused by land use changes, economics, invasive species, resource overexploitation, pollution and climate change. I dare say that others can add to that list and no doubt will. However, for any target to be realistic, whether at the global, national, regional or community levels, you have to have a very clear idea about the extent to which those different components are responsible for biodiversity loss. You also have to have suitable monitoring in progress, with research behind it, and then, with a bit of luck and with involvement from all interested parties, you might be able to put in place management measures and policies that will help to address the issue. It is no good setting targets without a very clear understanding of what you are trying to do.
	In October there will be a meeting in Nagoya in Japan at which Defra will be committed to supporting new, ambitious targets, yet, at the national level, Defra's draft structural reform plan talks about replacing the old top-down system of targets and putting power into the hands of people and communities with a better understanding of the practicalities, particularly the economics. This is precisely how we should be tackling biodiversity loss, whether at the international or national level, or at the community level, if we are to stem the loss of biodiversity.
	Policies and initiatives which are likely to enhance our biodiversity are much more likely to work if the local community is involved in analysing the problems and shaping the solutions. Therefore, whether at home or abroad, this is where the concepts articulated within the idea of the big society are absolutely appropriate. A partnership of local communities, civil society, members of the public and businesses-not least farmers and land managers-should be setting the local agenda, with of course a contribution from government at local and national levels and other such agencies.
	We have in this country the inestimable benefit of a large number of amateur and professional enthusiasts for conserving wildlife, and conservation societies with an enormous membership. My noble friend referred to Butterfly Conservation's butterfly count. I hope to get back in time to do my butterfly count this evening before the last of them disappear. When I looked this morning, 6,000 records had been posted since Saturday, and I am sure that by the end of the week the figure will be even more impressive.
	When we look at who should deliver on these proposals, farmers clearly come high on the list because they are, after all, responsible for 70 per cent of the land mass. However, agri-environmental schemes driven by government and by the European Union are not the only way in which you can help to influence farmers. Those who can also do so are their retail customers. As a fruit grower, I supply a large number of multiples, who are increasingly taking what I consider to be a very healthy interest in the conversation policies that we are adopting on the farm. However, the case for persuading farmers that they should participate in halting the decline in UK biodiversity must ultimately be underpinned by economics.
	We have never adequately assessed the value of our natural environment and the services that it provides. At the international level, the Millennium Ecosystem Assessment attempted to assess numerous ecosystems worldwide and to begin a dialogue for a science-based approach to their management and restoration. That was an excellent precedent and it is now being followed in the United Kingdom, which next year is due to publish its own UK National Ecosystem Assessment report. It is a massive work to which an enormous number of people-experts and amateurs-have contributed. I think that this assessment will give us the tools with which to understand the benefits to society and the economic prosperity provided by these services. I refer of course not just to biodiversity but to other environmental services as well, but biodiversity is probably the one area, together with climate change and the nutrient cycle, where we are demonstrably and clearly living unsustainably. Our loss of biodiversity is way beyond the natural level and we are clearly exceeding our sustainable practices. We shall have to concentrate on these points. It should then be much easier to make the case for putting in place land management practices for which the land managers-the farmers-will be appropriately rewarded to reflect the benefit to society and, of course, to ensure that polluters from any sector of society carry the cost of their actions.
	We should not underestimate the importance of urban gardens and parks. Garden ponds are highly significant as regards the biodiversity that they support. I refer again to Pond Conservation and here I put in a plug: please ensure you do not fill your ponds with tap water. That is not a good idea and it is the reason why so many ponds do not deliver all the benefits that they should.
	One of the programmes connected with Living with Environmental Change is Open Air Laboratories-OPAL-which were originally funded by the Big Lottery Fund, which awarded a grant to Imperial College. That is an example of an excellent initiative which has the key objectives of getting more people outside observing and recording the world around them, inspiring a new generation of environmentalists, and encouraging and supporting collaboration between community, voluntary and statutory sectors and academia.
	That is the kind of initiative which will do more than any international or national targets to develop and to enhance biodiversity. Regional research programmes and recording schemes, lively natural history societies, and adequate public funding for taxonomy are the basis for an understanding of our biological diversity and they will be the keys for a successful national biodiversity enhancement programme. The reason why I tip, on balance, towards optimism, like my noble friend, is that I believe that the Government have understood the importance of getting wide support from the community. That is to be welcomed.

The Lord Bishop of Blackburn: My Lords, I, too, am grateful to the noble Baroness, Lady Miller, for initiating this Question for Short Debate.
	It is not uncommon for biodiversity to concentrate on the more photogenic species but I shall concentrate on the local picture. My diocese of Blackburn may be thought of as an industrial area suffering from economic turbulence and decline. However, around 75 per cent of the area-the diocese is the Church of England in Lancashire-is classified as rural. Given that background, biodiversity is vital. If the rural economy is to flourish and to continue to provide more than 100,000 jobs in the whole of the north-west, we must maintain the habitats that we have and ensure that they do not decline any further. It is important not to let this issue slip away. We in the church have played, and will play, our part in ensuring that that does not happen.
	Recently, there was a conference held at Lambeth Palace of all the environmental officers of the Anglican dioceses. By sharing good practice and working closely together, they are making large strides to promote a healthy environment. We already have ecocongregations around the country and we will soon be launching the ecodiocese movement alongside it. Schools are involved. In my diocese, St Christopher's Church of England High School in Accrington hosted a very successful ecofair in June, and we hope that many young people will be involved in a bioblitz at Cuerden Valley in early August, where they will be encouraged to get involved in a ladybird project, among other events.
	It is fitting that I should concentrate on the young people. I want to echo what the noble Baroness said about education. The young people, of course, are the ones who stand to gain or lose most if we do not take care of the diversity that we have on this planet, which we borrow for such a short time.
	Some noble Lords will be aware of a few of the activities undertaken by the Church of England in support of the UN International Year of Biodiversity. In many urban areas, remember that the churchyard is often the only green lung for the community. The rural churchyard can often be a haven of biodiversity surrounded by acres of monoculture. If all our churchyards were placed side by side and end to end, they would form a huge national park. The church currently has over 12,000 churchyards throughout the country taking part in biodiversity projects. Last month, many of them took part in the Cherishing Churchyards initiative, as part of the nationwide project run by Caring for God's Acre and supported by the Church of England's national environment campaign, Shrinking the Footprint.
	For example, at St Peter & St Paul with St Andrew's Church, Flitwick, in Bedfordshire, more than 100 species of wild flowers have been recorded in the churchyard. All Saints, Odell, in Bedfordshire has won an award from the Campaign to Protect Rural England for its community-led conservation projects. Even in London, St Andrew's Church, Fulham Fields, has a dedicated section to its churchyard called the Fulham Fields wildlife garden. Although not a churchyard, the garden at Lambeth Palace-the home of the most reverend Primate the Archbishop of Canterbury, who is not in his place today-hosted an open day in May as part of International Biodiversity Day, run in conjunction with the National Gardens Scheme. Lambeth Palace has one of the oldest and largest private gardens in London, and has been occupied by the archbishops of Canterbury since the end of the 12th century. Its garden has a vast collection of plants and animals within its walls, including an historic white fig tree originally planted in 1555 and its own beehives.
	On 22 September, heads of state will assemble at the United Nations to discuss the biodiversity crisis, and the secretariat of the Convention on Biological Diversity is encouraging the ringing of bells all over the world on that day as an urgent call to rouse the world to action. We have already heard from a bishop in Uganda who, while having no bells in his diocese, has suggested involving the drummers of his parishes. I have already invited churches in my own diocese to be part of this worldwide call to action about the importance of biodiversity.

Baroness Byford: My Lords, I, too, thank my noble friend Lady Miller, who reminded us today of 10 years ago when we took the Countryside and Rights of Way Bill through this House, and of the many discussions we had on establishing a biodiversity action plan. I am grateful for the work that she and many others did with me at that time. It was a hugely important step. It was 10 years ago; it seems like only yesterday.
	In paying tribute to those who have worked for a long time, it is 30 years since the Wildlife and Countryside Link formed. It issued a report recently which struck me, because it covered each year. If we look back over 30 years, we see how much change has taken place. I follow my noble friend Lord Selborne in saying that I am quite optimistic. There is a lot to be done, but there is greater awareness and understanding than there was even when we were discussing the Countryside and Rights of Way Bill 10 years ago.
	I should declare my family interest and my many interests in farming organisations and in wildlife trusts. The Question asks what resources the Government will provide. It gave me great pleasure to look back on the few months for which this Government have been in being. We have had three major announcements. The noble Baroness, Lady Miller, referred to one of them. To take them in order, there was the recent announcement by the noble Lord, Lord Henley, about the establishment of Futurescapes, with the commitment to build partnerships with other environment groups, local communities, the private sector and government bodies. In doing that, it is hoped to learn from the major contributions made by others, including wildlife trusts, Living Landscapes initiatives and Natural England's integrated biodiversity delivery areas. That was one mark straight away.
	The second announcement, which may not be relevant today, was the Statement made in this House by the noble Lord, Lord Marland, on energy and waste. Farmers produce food and we use food, but there is also waste, and there is the question of how we use waste to help biodiversity in the long run. The delivery plan announced yesterday committed us to a comprehensive programme of appropriate financial support for renewable electricity and, as part of that, action to exploit the potential of renewable electricity from dedicated biomass, energy from waste and anaerobic digestion. That seems wide of the Question, but it is important. How we live and how we use our resources clearly has an effect on biodiversity. Only two days ago, on 26 July, the Secretary of State, Caroline Spelman, launched the environmental White Paper, An Invitation to Shape the Nature of England. It is an exciting paper and I hope that people participate in the consultation. Lastly, the noble Baroness mentioned CAP reform. That is too big an issue to cover in the time that I have today, but CAP reform has huge implications for biodiversity.
	I now switch to the subject of farming organisations. Farmers land-manage more than 74 per cent of the land. The NFU, the CLA and the Game & Wildlife Conservation Trust work hard at improving conservation awareness on all farms. The Campaign for the Farmed Environment was launched nine months ago and applies to arable land. More recently, there was a launch about horticultural land. It deals with how intensively farmed land can be sympathetically used to help wildlife.
	I turn to two other organisations. One is FWAG, of which the noble Baroness and my noble friend will be well aware. The second is LEAF, of which I am president. Here we are, 19 years on, with an organisation that was started to link the environment and farming together in ways that have developed in recent years. Its "Open Farm Sunday" is well known. More than 180,000 people visited farms on that day. It also runs the green box scheme and recently started the LEAF virtual farm walk, which is open to anyone to access from its site and is a very good way to encourage people to learn more about what happens on a farm. It also organises technical days and speak-outs.
	The noble Baroness and my noble friend mentioned taking the message to people so they have a better understanding. I mention FACE, Farming and Countryside Education, which is an organisation that takes the message into schools. Many other groups help. The NFU does, as does the Women's Food and Farming Union, but we need to do more to get the message out further and wider than is possible at the moment.
	I turn to the third leg of my stool. We have government and the farming groups, so it is us as individuals in what we do as individuals and within our groups. I totally agree with my noble friend Lord Selborne that we are trying to work together for the benefit of all. I do not think this is a thing that government or farmers can do alone. Togetherness is the way to succeed. Knowledge exchange, to which I referred earlier, is hugely important. There are ways in which we can get to those who are not lucky enough to be out and about in the countryside or to know how their food is produced or where it comes from. I have mentioned one or two, but there are also school visits, farmers going to schools to help and holiday days where people can go out into the countryside. There is an enormous amount of work undertaken there.
	Membership of wildlife groups and wildlife trusts is hugely important because not only does it teach people about what is going on in their local trust area, but it encourages them to take part. Any plans that we have that encourage people to feel part of it are hugely beneficially.
	Lastly on that side, I turn to the buying power of individuals. We buy our food and can look at labels-the red tractor flag, a LEAF flag or an assured scheme-to know whether it comes from a recognised source. That tells us how that farmer is producing that food. We have power. I suspect it is a power that many of us do not really appreciate, but I am dreadful when I go shopping and look very carefully.
	There are reasons for being optimistic, and there are individual ways in which we can help ourselves to benefit everybody. The noble Baroness posed us much more than a simple cash question. It is also a matter of commitment. This new Government have already shown that they are committed to looking at better ways to make biodiversity work in the widest sense. I am of the view that it is not just us on our own who can do it. I was particularly pleased when Caroline Spelman said in her formal announcement,
	"I want to nail a particular myth: that economic gain"-
	I pause here because farming must be productive and profitable-
	"and environmental protection are incompatible, whereas they are actually inseparable. And all too often we decide that looking after our natural environment is something to be left solely to Government".
	I hope this debate proves that that is not true.

Lord Teverson: My Lords, this is an excellent debate to have just before we break for the Summer Recess and I thank my noble friend Lady Miller for introducing it. In, probably, two days' time, I will be travelling from the biodiversity of urban gardens and suburban London-we are not quite there at the minute, but I will be travelling through it-westwards through the monoculture of Salisbury plain, where we have fantastic vistas but not a lot of biodiversity, down to where I live in the far south-west in Cornwall, where one of my great delights these days is that, almost whenever one looks skywards, one sees buzzards and other birds of prey that one would never have seen to that degree even a few years ago. That is perhaps one cause for optimism.
	At that point, optimism will end in my speech, but it is good to remember that this is not just about the great joy that we get from seeing the diversity that we studied as children and as adults; we also have a moral need to look after our planet and the things that have been bestowed on us to pass on to future generations. We should not forget that there is also an important economic implication of the loss of biodiversity. It has been estimated-how you estimate these things, I do not know-that some 7 per cent of world GDP may be lost by 2050 if we carry on with the rate of depletion of species that we have at the moment. Then there is the whole area of medical science. We still find nature, rather than the synthetic chemicals that we produce, providing us with many of our solutions to disease, so those areas are important as well.
	As the noble Earl, Lord Selborne, said, there are a number of reasons for biodiversity loss. One is the destruction of habitat. Another is the overexploitation of particular species, which tend to be the larger ones that we all know, see and love. The third important one is climate change, on which I will concentrate today.
	I remind noble Lords that five major extinctions have been identified over geological time. It is estimated that we are entering the sixth extinction. In the Permian period 250 million years ago-beyond even the living memory of those in this House-we lost an estimated 95 per cent of marine species and 75 per cent of terrestrial species. If we are moving towards that now, we should be very afraid indeed. The irony is that these mass extinctions are very good for biodiversity. In fact, there are more species on the planet today than there have ever been. The difficulty is that it takes several million years to recover from one extinction and get to the flowering of greater biodiversity later on. The human race is only some 200,000 years old and does not have that time.
	The challenges of climate change, global warming, the decline in biodiversity and a further potential mass extinction are great. Why do species disappear in the UK or anywhere else? It could be because some species move northwards swiftly with their own habitats as temperatures go up in the UK, or because of invasive diseases and invasive species, which are bad news for human beings in some parts of the world-malaria is an example. Such diseases can affect other species as well. It could be because of food loss or the symbiotic relationship between species. A well known example is a certain species of plover, which is starting to hatch at a different time from its food, the crane fly, because of the different ways in which those species have reacted to global warming.
	The largest threat, however, is probably the acidification of the ocean, as carbon dioxide gradually makes the oceans more acidic. Even now, that is affecting coral ecosystems in particular, which are the basis of food chains in the ocean. What really comes out of all this is the huge challenge for biodiversity, not just in the UK but globally. Clearly we all want to solve this through the mitigation of climate change. However, as so many noble Lords here know, that will not be the answer because many of those changes are already taking place.
	I will be slightly unconventional in this debate now. I was delighted to see that the speaker who follows me on the speakers list is the noble Baroness, Lady Young, who is one of the champions of adaptation. Indeed, she is a member of the Adaptation Sub-Committee of the Committee on Climate Change. I looked up the sub-committee's website before I left home and found a useful quotation:
	"At present there is little evidence on what successful adaptation over the next five years would look like, how we might measure it and set priorities".
	I suggest to her, the Government and the Minister that one area that desperately needs looking at is the effect of climate change on biodiversity and species loss and what adaptation strategies are needed. I looked at the sub-committee's work programme but could not find biodiversity mentioned. I know that the sub-committee is in its very early stages of work, but I commend that area as one to be looked at. What sort of strategies are the Government hoping through Defra to implement that will start to enable species in this country to adapt? For example, we could have a string of reserves, but we need to make sure that our existing habitats are resilient enough and that species can go a short distance upwards or from drylands to wetlands to give us more resilience in this area.
	I am pessimistic. At the moment, with a background rate of species loss some 100 times greater than is normal in geological time, we have a great challenge. I believe, as do many noble Lords, that with sufficient concentration we can solve this adaptation problem, but it is one of our greatest challenges. I look forward to hearing how the Minister and perhaps even the Committee on Climate Change will be able to confront that problem.

Baroness Young of Old Scone: My Lords, I am delighted that I will not be the only pessimistic person standing up today. I was beginning to feel that perhaps I would be my usual dark cloud in a sea of cheerfulness. I should declare an interest as president of the British Trust for Ornithology, the volunteer science body in bird conservation, and president of the Wildlife Trust for Bedfordshire, Cambridgeshire, Northamptonshire and Peterborough. Perhaps I should be allowed an extra minute to read the list of things in which I am involved. I am vice-president of the RSPB and of Plantlife, chairman of the Great Fen fundraising campaign and, as the noble Lord, Lord Teverson, said, a member of the climate change adaptation sub-committee. These are my UK interests. As this is a UK debate, I have not for the purposes of the record mentioned my international ones.
	I thank the noble Baroness, Lady Miller of Chilthorne Domer, for the opportunity to do our bit-playing the Glasgow Empire on a wet Tuesday being the equivalent of the last debate before we break for the Summer Recess-on something as important as this. I know that the noble Baroness believes that there are reasons to be cheerful and reasons to be less cheerful. I am trying to pitch what I say today as a realist because the picture of UK biodiversity is very mixed. The message that comes from what is and is not thriving is that, where action has been clearly targeted and counted, where resources have been particularly focused and applied, and where there is a comparatively small number of bodies involved in delivering, we have seen improvement. For example, our sites of special scientific interest were in a very poor condition. There has been a terrific effort by a substantial number of bodies, but not a huge number, to hit the 2010 target for improvement in quality of our SSSIs. That has been a great success.
	That pattern of success has been repeated across some habitats and some species. For example, a clear target was set for healthland re-creation and improvement in quality after a 90 per cent loss, with the progress being absolutely in the right direction. Where there is targeting and resources, and a comparatively small number of organisations involved, it can work. Other habitats and species have not responded, especially those species of the wider countryside and particularly, as has already been said, of the wider farmed countryside.
	Farmland bird declines continue. The most recent report by the BTO, the RSPB and the Joint Nature Conservation Committee demonstrated that farmland bird decline has not been halted. I believe that we are struggling in areas where there is insufficient targeting of resources, no clear injection of resources and where the actions that need to be taken are by a very large number of people.
	I was glad to see recently that the Secretary of State said that alongside climate change biodiversity loss is the greatest threat we face. We have already heard from the noble Lord, Lord Teverson, and others about future threats to climate change: namely, not only the impact on habitats in this country but also the pressure for global food security; population growth in this country, which is possibly enhanced by climate change; and, of course, development pressures. What we need the Government to do, while recognising the financial situation, is pick up the challenge, which is twofold. First, within this financial constraint, we must not lose what we have so recently achieved, so things like the progress that has been made with some biodiversity action plans on species and habitats, and on improving SSSI condition and the quality of our nature reserves must not be allowed to dribble away. Many bodies, organisations and individuals have worked hard on these. Secondly, we need to identify why the current mechanisms in the wider farmed countryside are not working, and then change them.
	I have five thoughts for the Government as they consider the natural environment White Paper. The first concerns agriculture and how we are going to sort out the impact of agriculture on biodiversity. The agri-environment schemes are absolutely vital to this. The entry level scheme is too broad, unfocused and untargeted. The pressure has been on reaching the coverage target of 70 per cent, which is admirable in that it would bring many farmers into an agri-environment scheme, but really it is about numbers rather than quality. We need to make sure that we are not just paying people to do the easy things, but to do the right things in the farmed countryside. I believe there needs to be a much greater focus on the higher level scheme in view of its importance in delivering good management on our best wildlife sites and on some of our most threatened species. Moreover, we face a problem in that farmers had been involved in the former schemes-the environmentally sensitive area schemes and countryside stewardship payments-which are coming to an end. I urge the Minister to commit to shifting resources to ensure that increases in the higher level scheme funding that were originally planned will continue.
	We need also to look at the other mechanisms in the wider countryside for agriculture beyond SSSIs. I recognise the commitment made by the National Farmers' Union and others to the Campaign for the Farmed Environment, but it is a voluntary scheme and is not yet showing results in the figures. We need now to look seriously at what can be delivered by further requirements for farmers to adopt cross-compliance. There should be simple but targeted actions in return for the single farm payment, a resource for which you, I and every other taxpayer in the country pays £1 5 billion, but which at the moment is not working for its living in terms of delivering biodiversity in our countryside.
	The second area I should like to cover is the marine environment. We have another country offshore. It is a wonderful one with hills and dales, trees and plants, birds, animals and fish in it. We all worked hard on the Marine and Coastal Access Bill so I hope that the Minister can confirm the Government's commitment to designating an ecologically coherent network of marine protected areas by 2012, as was agreed. Perhaps I may encourage the Minister to comment on the impact of the cut of £800,000 to the budget of Natural England in the marine field. Given that, can the commitment to the network of marine protected areas be honoured?
	The third area has been covered very well by the noble Lord, Lord Teverson, and concerns adaptation to climate change and the impact on biodiversity. I should say to the noble Lord that I will sit down with him in front of a computer to try and find the work programme and objectives for the climate change adaptation sub-committee because they are there, but perhaps lost in the e-somewhere. I can assure him that in September we will be launching our first report that will give a framework for measuring adaptation, including looking at how we might make progress in measuring biodiversity's adaptation.
	Climate change will put additional pressure on our wildlife and on our protected areas. We must not panic when the important species for which protected areas are designated cease to be there, because inevitably they will shift and change under climate change pressures. However, that does not mean that those areas are any less important. They are the only areas where space is specifically made available for biodiversity, so we need to make sure that whatever it is that wants to move on as a result of climate change has somewhere to move to. On a larger landscape scale, we need to make sure that our SSSIs and natural protected areas are made bigger so that they are more resilient in the face of climate change. We need to develop networks, with corridors and linkages between wildlife sites, so that they do not decline into isolated zoos for biodiversity.
	Many fine words are spoken about the ability of wildlife to move between sites-it is called "permeability"-but at the moment it seems to be a religion rather than a scientifically-validated mechanism. We need to make sure that the science is developed to enable wildlife to move and I urge the Minister to protect the science budget and move forward. We need to count whether or not we are doing well on biodiversity. I am alarmed that the PSAs have gone and yet we do not have a clear framework for how we are going to judge success. Many noble Lords will have heard me say before that football would be a bad game if we did not keep the score. I think that football is a bad game anyway, but it would be even worse if we did not keep the score. Biodiversity is like that. Much of the monitoring of biodiversity is carried out by volunteers. As president of the British Trust for Ornithology, I have 36,000 volunteers working on bird monitoring. They are skilled and unpaid and I urge the Government not to cut the government funding that levers that vast amount of free work.
	In preparing the White Paper, I urge the Minister not to over-rely on the big society. If anywhere in this country we have had a huge volunteer effort, a huge community commitment lasting more than 250 years, it is in biodiversity, and yet we are not winning, and so clearly the big society is not the only answer. We need targeting, resources and incentives for multiple actors to work-and only government can give that degree of leadership and co-ordination.

The Duke of Montrose: My Lords, I thank my noble friend Lady Miller of Chilthorne Domer for securing the debate. As this is the UN International Year of Biodiversity, it is right and proper that we should address this topic as many times as is necessary to drive it up the agenda. I declare an interest as a country dweller and a farmer. It is particularly necessary that we address this issue as the world has so spectacularly failed to achieve the target set up in 2002.
	I declare an interest in biodiversity as the land I own contains four SSSIs, an SAC, a nature reserve and is part of a Ramsar site. I have certainly learnt a lot about rare plants and invasive species in dealing with the management of it. One of the great delights now is the annual visit of the ospreys, let alone a great cross-section of other migratory birds, including a category 1 species of Greenland white-fronted geese.
	Obviously preparations are going on for the next UN Convention on Biological Diversity, as mentioned by my noble friend Lord Selborne, which will take place in Japan. It was reassuring to see that the recent G8 Conference in Muskoka issued a communiqué underlining the present failure in meeting the known 2010 target and voicing the need for adopting an ambitious and achievable post-2010 framework. I reiterate "ambitious and achievable" and it would be helpful if the Minister gave the House some indication of the Government's view of the criteria for such a framework.
	Noble Lords are probably aware that in 2006 the EU issued a biodiversity communication and a detailed biodiversity action plan for the whole of the UK. Once again the action required for fulfilment of the plan in Scotland is devolved, but the actions taken in Scotland will help to fulfil the UK's requirement. Here I am in a position of trying to determine whether the glass is half full or half empty. The picture in Scotland is possibly more encouraging than some mentioned here today, although there is nothing that should lead to complacency. My noble friend Lord Selborne pointed to ways in which we could enlist more members of society to achieve what needs to be done, but there might be some comfort to be drawn from the fact that, according to the 2008 biodiversity report for Scotland, just over 40 per cent of the 41 habitats assessed are stable or increasing in their biodiversity, and that about a third of the 230 species monitored were also stable or increasing. However, we cannot ignore the fact that about 15 per cent are declining. Also on the positive side is the fact that, at the end of 2009, 54 per cent of the biodiversity target was achieved. Much more needs to be achieved to bring remaining habitats to an acceptable standard.
	One of the roles envisaged in the Nature Conservancy (Scotland) Act is the monitoring of progress towards Scotland's 2010 biodiversity targets. By the end of 2009, just six were not being fulfilled. Prime among these seem to be progress in bringing protected sites into favourable condition; the necessity of meeting the target to contain the global mean temperature rise to 2 degrees centigrade-this means talking about the whole question of climate change; and the contentious target of establishing the level of fish stocks to produce a maximum sustainable yield. As noble Lords have said, certain measures were put in place by the Marine and Coastal Access Act. I think that we would all be glad to hear from the Minister any indication of progress that might have been made either in designating our own sites or in getting the EU to accept designations and give them proper EU recognition.
	I turn to the topic raised by the noble Baroness, Lady Young. I was concerned to learn from a briefing given by the Game & Wildlife Conservation Trust which I attended yesterday that a survey carried out by the British Trust for Ornithology has shown that, in spite of there now being four times as much land in farm conservation schemes as five years ago, there has been no recovery in the numbers of an average of 19 species of farmland birds. The point was underlined by my noble friend Lady Miller of Chilthorne Domer. It is an area that the trust is investigating. Strange things turn up. Apparently, oilseed rape is proving highly suitable ecologically for the overwintering of pigeons, but it does not help the species that are suffering from decline. If ever more money is going into environmental schemes and not producing results, as so many of those who have spoken have said, we must consider whether we are asking the right questions. I know that arable areas are seeing a decline in the number of larks, but we certainly see them on the moors. I do not know whether that means that we are heading in the right direction.
	I have one question on what appears to be a blanket policy in the UK biodiversity action plan-we have already touched on it today. It states that if global warming proceeds any further, six species will have to move northward and others are likely to do so. On this I believe is built the policy which states that there is an,
	"urgent need to reduce habitat fragmentation",
	which I presume fits in with the concept of wildlife corridors. There seems to be an element of irony in our pursuing this in too much of an unconsidered fashion at the same time as insisting that all farms and holdings have rigorous policies of individual biosecurity in case of the spread of disease. We are all too familiar with the scourge of avian influenza or one of the seven strains of bluetongue with currently threaten us.
	I come to a point made by the noble Lord, Lord Teverson. While wildlife corridors might help the movement of some species, are they not equally likely to aid the spread of pathogens and things that are inimical to biodiversity? We have already seen the ability of Dutch elm disease to work its way from one end of the country to the other even with what we might consider our fragmented habitat. Will it be up to someone in Defra to say where the line should be drawn? We have been left in no doubt by today's debate as to the challenge that we face, but we must keep as much of a focus on the issue as we can.

Baroness Quin: My Lords, I, too, congratulate the noble Baroness, Lady Miller, on introducing this subject and, indeed, on the informed and committed way in which she approached it. The Minister might concur with me that sometimes, when speaking from either the Government or Opposition Front Bench, one finds oneself speaking on issues with which one has not had a long involvement. Fortunately, the subject raised by the noble Baroness is one dear to my own heart and one which I have certainly pursued from both the Back Benches and the Front Benches-in both Houses, indeed.
	I believe, as the noble Baroness said, that this debate is very timely, particularly given the publication of the Government's natural environment discussion paper. Indeed, the Minister might even consider this debate as an early submission to the Government for that exercise. I certainly hope that the discussion paper will generate a lot of interest widely. We welcome the commitment to a White Paper; indeed, that commitment was in the now Opposition's manifesto at the time of the last election. The debate is perhaps also timely, as the noble Lord, Lord Teverson, said, because we are beginning the Recess, a time when it is hoped that Members of both Houses can get out into our countryside and appreciate our biodiversity. I do not know whether people will feel optimistic or pessimistic as a result, as the debate has wavered in both directions. Perhaps we can all agree that we wish the noble Earl well with his butterfly count over the summer.
	I believe that the concern which has been expressed today very much chimes in with wider public concern on this issue. Surveys show that very high percentages of the public worry about the changes to our countryside and the loss of native plants and animals. Indeed, that concern chimes in very much with local and regional identities; for that reason, I was pleased with what the right reverend Prelate the Bishop of Blackburn told us, in relating this subject very much to his local area and diocese. The concern is also reflected at international level. Not surprisingly, the fact that it is the international year of biodiversity has been mentioned. On that, I simply repeat that we cannot preach biodiversity abroad if we are failing to protect and enhance it at home.
	There is a clear link, which we all appreciate, between the quality of the natural environment and the quality of life and a general sense of well-being. Indeed, that point was made clearly in the State of the Countryside 2010 report, recently published by the Commission for Rural Communities. There is also an economic benefit. Certainly, the report of The Economics of Ecosystems and Biodiversity project makes the point strongly that the natural environment has economic value and contributes to economic growth, while its loss has high economic costs. In introducing this subject, the noble Baroness recognised that efforts have been made on a cross-party basis to try to promote and enhance biodiversity. She was also right to stress that, despite the concern and the welcome initiatives, there are a number of issues which it will be very important to address in the near future if we really are to tackle this issue effectively.
	The role of agriculture and farming is obviously important here; changing farming practices have had a significant effect on our natural environment. Indeed, I first became interested in this subject when I was a student in the 1960s, at a time when hedges first started to disappear rapidly. It is an irony that grants were being given then for hedges to be grubbed up and that they are being given now to replace them. None the less, despite that fact, there is still something of a loss of hedgerows in our country that needs to be addressed.
	There has been progress, as many Members have pointed out today. Farmers are generally much more environmentally sensitive than they used to be, and I recognise that. Although the cynical might say that that is just because they get grants, I do not believe that that is true at all. Farmers, like the whole of society, have become much more environmentally conscious. Indeed, farmers that I know take a great deal of pride in protecting and enjoying the biodiversities and habitats that they are able to create. Like the noble Baroness, Lady Byford, I pay tribute to the Campaign for the Farmed Environment, which I hope continues to attract strong government support in the coming months and years. However, there is a very worrying list of endangered species, of which we are all very much aware. The noble Baroness, Lady Young, rightly referred to the work, with which she is very familiar, of the British Trust for Ornithology, whose recent report charts a very worrying decline in precious bird species that are very integral to our countryside, such as skylarks, yellowhammers and grey partridges. Even familiar species such as the cuckoo and the house sparrow are in trouble. These are important issues. The Royal Society for the Protection of Birds has a current effort to try to reverse the decline in turtle doves, which has experienced an 88 per cent decline since 1970. I applaud the RSPB's efforts in working with Natural England and a group of farmers to tackle that issue.
	In practically every speech that I make on this subject, I mention red squirrels in Northumberland. Therefore, I do not apologise for doing so again. I hope that the efforts of local people in seeking to ensure that Northumberland can remain a red squirrel county can be supported by the Government and that investigations are made to see what buffer zones can be created between the red and grey areas, which is very important for all of us.
	International action continues to be important, although I recognise that the noble Baroness's debate is essentially about the situation in the United Kingdom. Even some of the species that we think of very much as British depend also on international efforts because of migration patterns. Therefore, the work in that sphere continues to be terribly important. Fishing, which was mentioned by the noble Baroness, Lady Young, is also tremendously important in that sense; European as well as international regulations are so important in that area.
	Like the noble Baroness, Lady Young, I am concerned about the possible effect of cuts on environmental grants in particular. Following our most recent debate on the uplands, I wrote to the Minister's colleague, the noble Lord, Lord Henley, about this. I know that these areas of spending are not ring-fenced, so some reassurance about spending levels on environmental schemes is important for us. On another point that was mentioned, if we continue to give money for these schemes, as I hope we do, perhaps better checks could be put in place in future on the results of these schemes. If money is used in this way-and I very much hope that it will be-it is important that we should none the less know whether progress is being made and that gains are not being reversed.
	I wish that the Government were not cutting themselves off from independent sources of advice such as the Commission for Rural Communities and the Sustainable Development Commission and the Royal Commission on Environmental Pollution. The Government themselves need an independent check, in many ways, and I urge the Minister to reconsider some of these decisions.
	As I have run out of time, I conclude by saying that government action in this area is vital. However, concern on this issue unites urban and country dwellers alike in our nation. It is an important issue for the future and for our future quality of life, and for that reason I hope that this House will continue to promote the subject regularly and determinedly.

Lord De Mauley: My Lords, like other noble Lords, I congratulate my noble friend Lady Miller of Chilthorne Domer on securing this debate. Her timing is excellent. As she mentioned, 2010 is the International Year of Biodiversity and in October my right honourable friend the Secretary of State will be leading the UK delegation to the conference of the parties to the Convention on Biological Diversity in Nagoya to negotiate demanding new global targets for halting biodiversity loss. We must underpin that international commitment with national action. I confirm the coalition Government's strong support for that process.
	I declare a personal interest as a farmer and landowner who is directly involved as a small cog in this large wheel and a keen participant in fostering biodiversity. Like my noble friend Lord Teverson, I enjoy seeing the buzzards that are now regularly to be seen wheeling around above the trees, just as I enjoy listening to the larks that my noble friend the Duke of Montrose mentioned.
	The meeting in Nagoya represents a critical moment in the history of the convention and, indeed, of humanity. We need to consider biodiversity not just in its own context but, as several noble Lords said, in the context of the fight against climate change. As my noble friend Lord Selborne said, we must also factor in the value of ecosystem services to our development and accounting processes, as well as the contribution that they make to our quality of life by inspiring and enriching our lives and contributing to our health and well-being.
	As my noble friend Lord Teverson said, only by taking such a holistic approach across biodiversity, climate change and development can we hope to overcome the unique challenges that we face. The importance of this is highlighted by the fact that, despite some successes, biodiversity loss has not been halted in recent years, as, among others, the noble Baroness, Lady Young of Old Scone, said.
	The commitments that the Secretary of State will make in Nagoya will be on behalf of the United Kingdom as a whole. Action to conserve biodiversity is of course a devolved matter, but it is one on which we keep in close contact with our devolved counterparts, ensuring that the commitments that we make, and our capabilities and appetites for delivering them, remain in step.
	This debate is also timely because on Monday the Government launched their consultation on the natural environment White Paper, demonstrating our commitment to protect and enhance the natural environment. It is through this process that we will be developing an ambitious statement by April next year outlining our priorities and setting out a framework for practical action by government, communities, businesses and civil society organisations to deliver on that commitment. My noble friend Lord Teverson asked about our approach to climate change. Climate change will be a theme that runs right through that White Paper.
	Of course, the way in which we deliver on our commitments will take its place within the context of our overall requirement to reduce the deficit and reflect the Government's plans for reducing regulatory burdens. We also know, however, that we can no longer afford the costs to our economy and quality of life that arise from a degraded natural environment. Despite our growing knowledge of the real value of that natural environment, and the significant improvements made in some areas over the last 20 years, it faces major challenges. For years, as my noble friend Lady Byford said, the economy and the natural environment have been pitted against each other, as if they were competing choices rather than mutually interdependent.
	For too long, we have been content just to try to limit the damage, yet globally it is estimated that the degradation of our planet's ecosystems is costing us €50 billion each year, a figure that could rise to the equivalent of 7 per cent of global GDP by 2050. We are choosing to lose the valuable benefits of a healthy natural environment on a massive scale. A vibrant natural environment is not a luxury for the good times; it is a necessity for economic recovery and sustainable growth for the long term. We have the opportunity to be the generation that puts this right. It will take an ambitious and radical transformation in our economy and our society and in securing our future, but the prize is worth it and essential for our well-being. We must grow a leaner, greener economy, which properly reflects the true value of nature's services in the way that it works in its prices and markets, which prevents the costs of environmental degradation and, indeed, which opens up new business opportunities and creates new jobs.
	In line with our commitment to shifting the balance of power from big government to what we are calling the big society, as my noble friend Lord Selborne said, we want to work closely with all the interested parties-individuals, businesses, churches, civil society groups, land managers and local authorities-to articulate a new, compelling and integrated vision and set out an action plan for sustaining and managing our natural environment. Therefore, the positive comments from all sides of the House today, which amply demonstrate the keenness of society as a whole to get involved, are very welcome. I also pay tribute to the thousands of volunteers who do conservation work, including the butterfly count of which my noble friend Lord Selborne will do his share this evening, if I do not take too long winding up.
	We will do everything that we can to support this vital wider transformation. The coalition's programme for government already sets out a range of commitments to protect and enhance the natural environment, including: maintaining the green belt, SSSIs, about which the noble Baroness, Lady Young of Old Scone, asked, and other environmental protections; creating a new designation to protect green areas of particular importance to local communities; introducing measures to protect wildlife; promoting green spaces and wildlife corridors to halt the loss of habitats and restore biodiversity; giving councils new powers to stop garden grabbing, recognising that domestic gardens can offer some of the best habitat for our wildlife, as my noble friend Lord Selborne said; and launching a national campaign to increase tree planting by the private sector and civil society. I declare a personal interest, having embarked on a major tree-planting exercise six years ago. We will also be assessing the scope for action to offset the impact of development on biodiversity. As part of this assessment, we will consider what we can learn from the experiences of other countries.
	With restoring and expanding priority habitats in mind, as my noble friend Lady Miller said, we are looking forward to receiving Sir John Lawton's report of the review on the coherence of ecological networks, Making Space for Nature, later in the summer. My noble friend Lord Teverson asked about adaptation. The Lawton review will provide evidence on which we can build our work on adaptation to climate change. In March, Sir John reported that to achieve a coherent and resilient ecological network we will need to look beyond existing designated sites and take account of landscape designations, local wildlife sites and green spaces. This work will help to inform the development of the natural environment White Paper.
	Protecting marine biodiversity, while enabling the sustainable use of marine resources, is also a priority. As we are an island, our marine resources are central to our economic and social well-being. We are committed to managing them in a manner that supports current users but leaves them in a better state for future generations. To achieve this, we are dedicated to a comprehensive marine biodiversity programme, which, given the economic climate, has to be focused on priority areas. Our aim is to achieve clean, healthy, safe, productive and biologically diverse seas and oceans. To do this, our priorities are to reform the common fisheries policy, to deliver an ecologically coherent network of marine protected areas and to reduce by-catch and discards of species in fishing activities. We will lead by example and put the value of our natural environment at the heart of government policy-making.
	I turn to some of the specific points made during our debate. My noble friend Lady Miller asked about our commitment to and preparations for Nagoya. The Secretary of State's personal commitment is clearly demonstrated by her decision to attend in October. She is also involved in a number of preparatory meetings and has already met EU ministerial colleagues and the Japanese Minister this month, as well as Pavan Sukhdev, the leader of the TEEB study, which will be one of the main items discussed at Nagoya.
	My noble friend also asked about progress regarding MPAs in the marine context. We will establish an ecologically coherent network of MPAs that will ensure that the range of species and habitats in our waters is protected; 154 marine sites have already been designated and 15 sites are being considered for submission to the European Commission. Further sites will be brought forward. The Government will establish a monitoring programme so that we know whether the network of European MPAs and MCZs is achieving our objectives.
	While I am on the subject of the marine environment, the noble Baroness, Lady Young of Old Scone, asked about our more general approach to it. Marine issues will be covered by the natural environment White Paper. The Marine and Coastal Access Act 2009 established a forward-looking approach to managing marine activities. It created a streamlined licensing system, a new system of marine planning, the Marine Management Organisation and marine conservation zones. MCZs will conserve marine species, habitats and features. The White Paper presents an opportunity to build on that.
	My noble friend Lady Miller asked about the coalition Government's attitude to the concept of the outdoor classroom, and the right reverend Prelate spoke of the importance of young people understanding about biodiversity. The Environmental Stewardship Scheme-I declare an interest as a participant in the ELS scheme-has been part of an initiative which has contributed to supporting nearly 800 farms in England offering educational access visits by schools, involving more than 100,000 children a year. The Young Darwin Prize, a competition for the best nature news videos, is another example of Defra's involvement in encouraging young people to conserve nature and communicating the importance of biodiversity. While still on the subject of young people, I am please to hear from the right reverend Prelate about the success of BioBlitz. More than 20 events are taking place around the country this year, following the successful pilot in Bristol last year.
	My noble friend Lady Miller asked about the intergovernmental panel on biodiversity and ecosystems, which is an initiative that we welcome.
	Several noble Lords asked about the Government's approach to the economic situation, and how we will reconcile that with our aspirations for biodiversity. Deficit reduction and ensuring economic recovery are the Government's top priorities, but we also know that we can no longer afford the costs to our economy and quality of life that arise from a degraded natural environment. The whole economy relies on a healthy natural environment. Our businesses and industries rely on it for resources and material, and all sectors can save money by using resources more efficiently. Noble Lords have asked a number of other questions that I do not have time to answer today. I will write to them after today's debate.
	I conclude by saying that the process that we have started to develop with our White Paper on the natural environment is an open invitation to all interested parties to help inform and influence the Government's plan of action for conserving and enhancing the natural environment. The Government, communities, businesses and civil society organisations can all contribute. We look forward to welcoming contributions from far and wide.

House adjourned at 3.29 pm.